Topic: 5 things you need to know before trading crypto - page 2. (Read 779 times)

Thanks! Yeah, definitely only invest what you can afford to lose. I'm glad that HODLing is working for you - I mean, it is a proven strategy. Diversifying a portfolio (like yours is) is also important.

I agree with all the things that you have provided.
It is totally good to make own research about a certain investment or cryptocurrency and take note having enough knowledge will help you to avoid big losses.
Make sure you will only invest the amount that you are not afraid to lose.
I am also a holder but most of my holding is top rank cryptocurrencies just like bitcoin, ethereum, and ripple. it is totally good to hold if we experience bear market and do not do panic selling if you see rapid falling down of the price.
I always remember that quote "Don’t put all your eggs in one basket" and actually my money is separate in different cryptocurrencies but the 50% of that is in bitcoin.
Using any kind of trading tool will totally help you to become a better trader and lastly, keep on learning until you become a professional trader.

Indeed and no matter how much you are sure with your entry because you did a technical analysis and every TA you did gives a positive sign, and there is an event coming in their way, but when the Bitcoin dropped unexpectedly it will affect the coins/tokens that you are holding too, so we should also take this into consideration and always be ready when this happen, we should be alert in the market and not just buying and setting sell order.

I like those 5 points.  Some additional things for a new investor are:

A) Keep in mind that for every trade, you lose money in fees. Also, every time you move money to and from an exchange, you lose money in fees. This has to be considered because it cuts into your profit.

B) Exchanges are inherently risky. You’re taking a chance on the exchanges getting hacked or stealing your money.

C) There may be tax implications when you make a profit from a trade depending on what country you live in. In America, you are supposed to track every trade and report it.

Not giving in to FOMO and FUD can be really challenging - we're all human and we all want to get the best out of our trades/investments. I think you're definitely right about that.

The world of cryptoassets can seem incredibly confusing to new traders. We get it – we’ve all been there. Even experienced crypto traders make mistakes from time to time. Successful crypto trading is all about being prepared before you do anything – that’s where we come in. We’ve compiled a guide of all the things you need to know before trading crypto.

https://www.youtube.com/watch?v=RQtvpNYtLfw


Do Your Own Research (DYOR)

DYOR or Do Your Own Research is a super common term within the crypto community. DYOR is pretty self-explanatory, but serves a reminder to always investigate coins before you buy them or start trading with them.

There are tons of resources online for you to start with. From cryptocurrency subreddits to Youtube, Quora, Twitter and BitcoinTalk forums, you’ll honestly never run out of new things to learn. Starting to trade crypto is a personal decision, but you can make sure that you’re guided well and you have a wealth of knowledge at your side.

Invest what you’re willing to lose

This point is utterly crucial. Never invest more money than you are willing to lose. That’s just a bad idea. Taking loans, maxing out credit cards, or even just trading outside of what you’re comfortable with and can afford, is a recipe for disaster.

Only ever invest what you’re willing to lose. There is always a risk to crypto trading, no matter how well you’ve researched a coin, so always be prepared for a negative outcome.

HODL

We’d say that 99% of successful crypto investors and traders are massive proponents of HODLing. To HODL is to hold on to your coins, even when the market dips rather than sell up and cash out. HODLing generally sees you achieve a much better result in the long run!

Just think of those poor sods who sold their Bitcoin just before the price soared to their highest heights in December 2017 – ouch.. HODLing is almost always the way to go – rather wait out bear markets and make an informed decision when it comes to ridding yourself of a digital asset.

Diversify your portfolio

Ever heard the old saying, “Don’t put all your eggs in one basket.”? Yeah, the same applies here. When you first start out, it’s important that you research more than one coin that you’d want to trade with. Don’t spread yourself out too thin, but ultimately you’re likely to have more success trading with two or three coins instead of one. Of course Bitcoin (BTC), Ripple (XRP), and Ethereum (ETH) are all fantastic choices, but also do some research and find out about other altcoins that may work really well for you.

Putting all of your money into one trade, could ultimately result in you losing all of it. If that coin dips you’re in trouble, so rather diversify your trades across a few coins to mitigate your losses!

Overcome Fear, Uncertainty and Doubt (FUD)

One of the most crucial things you need to know before trading crypto, is how to overcome FUD. FUD stands for “Fear, Uncertainty and Doubt” and is a crucial factor in determining whether a crypto trader will be successful or not.

Unfortunately, this one is up to you – overcoming FUD is your own journey. However, what we can say is that you should always listen to your gut and your knowledge, over others. Don’t give into fear-mongering and always do your own research (DYOR) before acting.


https://www.youtube.com/watch?v=ALTY72Qsgzo

Tools for trading

Having read this guide, we hope you now feel comfortable with all of the things you need to know before trading crypto. The 5 key things to remember are: FUD, HODL, Diversification, DYOR, and Investing only what you can lose. Other than that, always remember to stick with your gut and make informed decisions in every aspect of your crypto trading.

eToro is the world’s top social trading platform. Want to find out more? Click here.

Cryptoassets are volatile instruments which can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading cryptoassets is unregulated and therefore is not supervised by any EU regulatory framework. Your capital is at risk.

https://www.etoro.com/blog/market-insights/5-things-you-need-to-know-before-trading-crypto/

That's an interesting take - I think you could HODL any coin if you wanted to, but it may make more sense to HODL only the top coins as you said. And yes, having a diverse portfolio is important to help limit overall risk.

For HODL only suitable for coins that are stable enough or can be said for coins that are in 1-50 coinmarketcap rankings, the rest if you choose to HODL will lead to more destruction, I prefer to sell if it has decreased 10-20% because it's the limit I can bear, also don't put all the fund in one coin better to seperately.

All of the things mentioned in the OP are true, and I also have a similar opinion. Trading is not just buying coins at low prices and
selling coins at high prices, but there are some rules that are must be run like investing money that we can afford to lose, do not
be fanatical about one coin, do technical analysis and fundamental analysis to see the movement of coins in the market, and most
importantly do not become panic traders. Those are some basic rules that need to be known before starting trading, I suggest not
to break the rules, This is in order to gain profit in trading and avoid losses.

FOMO and FUD is the hardest. You may not even engage in trading but just investing crypto for holding coins but you will always think of losing money when prices drops and bear market continues for years.  A friend, a holder who had kept his coins for years since 2015 tried to update his wallet and took profit because of FUD. You may find yourself in such situation during bear market. If the price of BTC rise so high, you wouldn't really think of the riches to lose after that.

I just want to add for the list is learn first the fundamentals of trading. Before engaging in trading you must have gain an experience first so that you can realize what is the do's and don't also it wouldn't hard for you to deal with problems. Always remember that set aside our emotion because this will be only a hindrances in our trade. I like the idea of diversifying our trade to avoid losing all of our funds, just like what other said "don't put all the eggs in one basket". Remember as well that invest only the money that you can afford to lose.

Hmmm nice list. I honestly though at first HODLing was a joke and well, the joke punched me back in the face. DYOR and investing what you can lose are the top 2 for me though, especially DYOR. Without it, its like fighting a war without a gun. I'd also advise brushing up on your trading skills though since it is before trading crypto, id guess thats already a given.

Agree to those points above but these are the things i do want to add up.

1. Read and understand on what you are getting into. Cryptocurrency is quite a broad space.
2. Learn trading basics and coins would be traded.
3. Be keen on reacting either FOMO or FUD.

The best one is that only invest on the amount you can afford to lose as always.

This is the major reason why I am involved in long term trading and that too only with bitcoin because in that way I am able to avoid majority of the stress giving news, predictions and trends. Cool minds are always able to make right decisions and I, along with majority of the day traders, am unable to have good control over my emotions when my crypto asset is having bearish market.

Do Your Own Research (DYOR)

DYOR or Do Your Own Research is a super common term within the crypto community. DYOR is pretty self-explanatory, but serves a reminder to always investigate coins before you buy them or start trading with them.

There are tons of resources online for you to start with. From cryptocurrency subreddits to Youtube, Quora, Twitter and BitcoinTalk forums, you’ll honestly never run out of new things to learn. Starting to trade crypto is a personal decision, but you can make sure that you’re guided well and you have a wealth of knowledge at your side.