Diversifying Your Portfolio in Crypto - page 9.

goinmerry

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Quote from: VuSpark on November 24, 2021, 03:51:26 AM

All you hear about these Trading and Investing rules that " Dont put all your eggs in one basket " or " Diversify your portfolio "

But how we Apply these rules in Crypto Market.

When Bitcoin moves 95% alts dumped. BTC moves up or down, Alts goes down. where we invest and no one can predict the market movement.

So what would be the right strategy of Diversifying Crypto Portfolio...

No one can tell you the right strategy, make your own instead. We have our own strategy Even we do the same strategy here, the ways and methods will be different. Give some tests. Risk some money and observe in the long run if you are making a good following on that test strategy.

There's no specific strategy you can rely on like copying others' way during the situation you have mentioned.

Ryker1

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Diversification is not always about winning, most of the time its about having a good strategy on how to lessen the risk of losing money, so its advisable to diversify but I don’t suggest to over diversify, have at least 5 good options and you can be good. I diversify on every market, Bitcoin, altcoins, and NFTs, so far I’m still making money, you can also trade or hold depends on your goals and strategy.

Well, this is right and I agree.
Diversification of your portfolio does not mean you always have profit, sometimes you need to divert your portfolio when you see bitcoin is down and you need to divert into a stable coin which is later on repurchase after the market back to the price. Invest money on which coin you believe that it will grow up the price and I stick on the bitcoin, perhaps 90% of it was on bitcoin and the rest is on different altcoins, --and that is right, don't put your egg in one basket but it does not mean, altcoins are my priority.

Silberman

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Quote from: VuSpark on November 24, 2021, 03:51:26 AM

All you hear about these Trading and Investing rules that " Dont put all your eggs in one basket " or " Diversify your portfolio "

But how we Apply these rules in Crypto Market.

When Bitcoin moves 95% alts dumped. BTC moves up or down, Alts goes down. where we invest and no one can predict the market movement.

So what would be the right strategy of Diversifying Crypto Portfolio...

I think you have the wrong idea, when you read some books about diversifying your portfolio the authors are not really talking about buying several assets that fall in the same market, instead the authors are talking about buying assets in many different markets, so if you really want to diversify your portfolio then besides bitcoin you need to buy some precious metals, stocks, bonds, art, real estate and commodities, no diversification is possible if you buy altcoins if you already hold bitcoin because as we know they follow the movements of bitcoin most of the time.

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Quote from: tvplus006 on November 24, 2021, 06:57:30 PM

Quote from: VuSpark on November 24, 2021, 03:51:26 AM

...So what would be the right strategy of Diversifying Crypto Portfolio...

Regardless of which way the market is moving, you need to keep part of your deposit in stablecoins. And if the market unexpectedly undergoes a dump, in this case you will have a great opportunity to buy coins at a reduced price. In addition, part of the deposit should be directed to the purchase of BTC and ETH for long-term hold.

Having some funds on stable coins would really be not just on making yourself secure on volatility but also you could really able to get in when you do see some opportunities which means its a good measure to have this kind of reserve as always.

Im doing this eversince which i could say that it is really that you could really get in without the need on waiting up for some deposit confirmations
and for those who havent considered this one out then you would really be finding it for yourself.

Oceat

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First, before talking about diversifying you must know what coins you need to invest and make sure you do your own research before investing.
Second, diversifying is being used if the market is starting to dump like most of your coins are in red and you think it's the right time to sell because bear will be coming soon. So you sell those coins who doesn't have the ability to return back to normal again or not that profitable if you hodl them longer.
And third, only hodl Bitcoin for long term or buy more of it if there's a chance like dip/correction/dump/drop. But if you have a better understanding to a certain altcoins you can either buy more of it and it hold it for a long term investment or just don't but instead focus it more on Bitcoin.

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Quote from: VuSpark on November 24, 2021, 03:51:26 AM

...So what would be the right strategy of Diversifying Crypto Portfolio...

Regardless of which way the market is moving, you need to keep part of your deposit in stablecoins. And if the market unexpectedly undergoes a dump, in this case you will have a great opportunity to buy coins at a reduced price. In addition, part of the deposit should be directed to the purchase of BTC and ETH for long-term hold.

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Quote from: hugeblack on November 24, 2021, 11:36:09 AM

The concept of diversifying the investment portfolio is called portfolios that do not move together or are not linked to each other, and therefore most of the prices of all cryptos are closely related to Bitcoin, and therefore investing in a thousand crypto and in one , the two the same which is placing eggs in one basket.

The best thing is to keep the cash and try to distribute the investments to achieve a different gain, but we cannot consider it a diversification.

I would not say that's the case for most of the time. Things could go up and down without the need for bitcoins existence or how that's moving. There are times when we could see bitcoin staying still and altcoins having an alt season, we have seen that multiple times so far and I agree that there is definitely a case things could go up individually as well.

I agree that most of the time when market moves then it moves all together and it doesn't move independently, but it isn't all the time, it is only most of the time. Which is why if you really want to invest into something that is not bitcoin then you should be able to do that however you want.

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Quote from: VuSpark on November 24, 2021, 03:51:26 AM

All you hear about these Trading and Investing rules that " Dont put all your eggs in one basket " or " Diversify your portfolio "

But how we Apply these rules in Crypto Market.

When Bitcoin moves 95% alts dumped. BTC moves up or down, Alts goes down. where we invest and no one can predict the market movement.

So what would be the right strategy of Diversifying Crypto Portfolio...

Diversifying is always been recommended specially into this market which it had been always been suggested because if you do just focus on only one and tends to dump out then theres no way for you to recover at least out of other investment you do have thats why the more the better but we know that not all would really be having the money
to invest on various coins and just ending up on investing on single point thats why we do really miss out this kind of investment method.
Even if we wanted to but we dont have funds to be used then we wont be having any choice.

Johnyz

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Quote from: VuSpark on November 24, 2021, 03:51:26 AM

So what would be the right strategy of Diversifying Crypto Portfolio...

Diversify with good coins/tokens, since the last peak Bitcoin and other good altcoins was able to rise together so I think the scenario when Bitcoin pumps and altcoins will dump are just part of the history and now we are in a new era when the pumps happen, good projects will also ride with it. Always know how to diversify because its too risky to just invest on one option even if its Bitcoin, don’t miss the chance to make more money here in the market.

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Just don't diversify a lot because that can also bring you down. Invest to the top coins after you think that you're holding enough bitcoin already. We want to diversify as much as we can but in my case, it's more than 50% of my holdings are in bitcoin. While the rest, they're in altcoins including Ethereum which has the biggest part. I don't know my strategy in the near future but it changes from time to time because I also rely on the market sentiment which makes me buy more sometimes bitcoin and altcoins that are on the trend.

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The concept of diversifying the investment portfolio is called portfolios that do not move together or are not linked to each other, and therefore most of the prices of all cryptos are closely related to Bitcoin, and therefore investing in a thousand crypto and in one , the two the same which is placing eggs in one basket.

The best thing is to keep the cash and try to distribute the investments to achieve a different gain, but we cannot consider it a diversification.

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Quote from: VuSpark on November 24, 2021, 03:51:26 AM

When Bitcoin moves 95% alts dumped. BTC moves up or down, Alts goes down. where we invest and no one can predict the market movement.

The more reason for you to have more BTC compare to alts when you want to diversify your own portfolio. I guess have 70% Bitcoin and most of the alts would compose only 30% of the overall portfolio. Bitcoin should be the utmost important since it's the most liquid asset in the market.

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Quote from: Etranger on November 24, 2021, 07:32:50 AM

I disagree that portfolio diversification is generally good advice. Sometimes it works, but for me there are much more important rules. From my trading experience, I would single out 3 main tips.

1. Buy only when there is complete confidence that the asset will rise to the price that you set for yourself as a sale target.
2. Don't set yourself too long-term goals. It is better to retern into cash and wait for the next convenient position than to be frozen in the asset for an indefinite period.
3. Follow a pre-planned strategy and do not change it when you have already opened a trade.

If you follow these rules, then you can not scatter eggs in different baskets, but make money on shorter periods on successful coins.

Even if that diversification divides assets, then that's what I do and it's still profitable for me. Your words seem easy, but they're hard to execute. Strategies can be planned but sometimes the market demands many alternative strategies to do. Sometimes that makes me dizzy. In addition, sometimes there is greedy nature that makes us often lose. Everyone has a different trading strategy, maybe your strategy is like that. There are several different people and it adapts to what they think is most profitable.

Etranger

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I disagree that portfolio diversification is generally good advice. Sometimes it works, but for me there are much more important rules. From my trading experience, I would single out 3 main tips.

1. Buy only when there is complete confidence that the asset will rise to the price that you set for yourself as a sale target.
2. Don't set yourself too long-term goals. It is better to retern into cash and wait for the next convenient position than to be frozen in the asset for an indefinite period.
3. Follow a pre-planned strategy and do not change it when you have already opened a trade.

If you follow these rules, then you can not scatter eggs in different baskets, but make money on shorter periods on successful coins.

michellee

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Maybe you can diversify your portfolio when the bear market comes to have so many options of coins to buy. But that will be okay if you want to diversify your portfolio now because you can see many coins will have a chance to increase higher in the next altcoins season or bull market. But unfortunately, that can make us confused to select the coins that can increase as many coins already hit the highest price.

When bitcoin is down, you can buy bitcoin but you can give your attention to buying altcoin but you need to look at how deep the altcoin price will go down because sometimes, the altcoin price can go down too deep. So I am sure you will have your own strategy for diversifying your crypto portfolio.

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Still, it doesn't mean that you shouldn't diversify your portfolio. There would still be instances where a coin would go up (or down) regardless of what Bitcoin does after all. Plus assuming what you said always happens, then wouldn't it be the same if you invested in Bitcoin or diversified it? It'd go down nonetheless since as you said, it follows Bitcoin. Find some coins that you think could go premium, those coins would go up naturally even if it went down due to following Bitcoin, you'd still profit in the end imo.

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Keep building your portfolio and know the exact time to sell a specific coin. The cryptocurrency market cannot be predicted so, I cannot state exactly what coin will make it to the top or to $15 from 5 cents. So watch the market and read more of white papers. this practice will guide you about different projects. listen to your instinct only. When you are told not to put all your eggs in one basket do not ignore the advice because the volatility of cryptocurrency is unpredictable. If you have let's say 2k to invest watch the coins that have pumped and stayed for quite sometimes before going bearish, check the interval at which it took for the coin to go back to it's previous ATH.

Because, I remember a specific coin Nano that made it to $15 when bitcoin was at 50k early this year, but fell back to $5 when bitcoin slacked back to 29k but after the wave of bitcoin to 59k again the coin remained and was dangling at $5 - $6 which was not a good sign. Altcoins cannot be predicted like bitcoin, but it is better to spread your net of baits (funds) to the river of cryptocurrency. they is no way the fish (profits) won't get to you. Good luck

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Not all coins dumps there are still some coins that was left going up along with the Bitcoin the reason why you shouldn't put it all along in one basket is that if the not all coins dumps at the same time and some are still going up. It's good for your fund so it will not be easily lose a position that was just my personal opinion and I choose to diversify my portfolio rather than staying on one cryptocurrency.

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Yes, you shouldn't put all your eggs into one basket, but that doesn't mean that you should put them into random coins.

Meme coins are not the way to go unless you like to gamble. Exchanges coins are also not something I would recommend, they're way too centralized and all it would take for these coins to crash is for the exchange to have some issues with the regulators.

Sure, the markets can be volatile and difficult to predict but you should always follow the fundamentals and not the hype, if you're only looking for short-term profits, then this may not be for you.

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Quote from: VuSpark on November 24, 2021, 03:51:26 AM

So what would be the right strategy of Diversifying Crypto Portfolio...

Diversification is good because if done at the right time, in due time you get the benefit. The way to invest and diversify is when there is bear season. Buying low is the best time to diversify and wait to sell high. There are speculation that after bitcoin bull , the bull for altcoins will come so maybe investing this time to sell immediately the altcoins begin or waiting for next year bear to buy and hodl for the next bitcoin halving.

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