Topic: Does crypto help to diversify your investment portfolio? (Read 360 times)
It does help, though the risks are higher, especially if what you're considering are those altcoins that are maybe irrelevamt or a whale could just crash it to death. Still, we have to acknowledge that cryptocurrencies provide another space for investment, although still it isn't meant to be a speculative asset, but rather has a main goal of having an alternative payment system.
When you plan in financial planning crypto is considered as alternative investment and it does add value in our investment as it compounded it's value depended on market conditions just like in stocks. It will depend on how much we put as investment in it and I believe it's a good investment too. It good to diversify our investment depending on our risk appetite so better have still some investment that may not increase a lot but still have a chance to secure our capital.
From the topic subject itself, actually being involved in cryptocurrency is already having a different portfolio and is readily diversible, meaning to say that yes it does really diversify your portfolio but introducing you to a whole new umbrella of investment cryptocurrency. So, if you are an investor, is it quite hard to maintain all your investment if you have other than cryptocurrency. If you want to invest and have a good porfolio in cryptocurrency, then you must stay focused on it, always look at the market condition, and accumulate many promising cryptocurrency.
That's why you should divide your investment according with markets 24h cap and price value.
One reason people should not take advice from forums and blogs
Trading based on market cap and volume in crypto is the bulletproof way to lose your money in a matter of days.
The simple quicker answer is YES, of course.
The complete one is: I can use a portfolio of multiple investment cryptocurrencies so that when price changes on specific alts i can switch to others and trade immediatly.
The complete one is: I can use a portfolio of multiple investment cryptocurrencies so that when price changes on specific alts i can switch to others and trade immediatly.
You don't understand what diversification means.
It means investing in stuff that is either unrelated so it won't take a hit, like cocoa futures and BMW shares or totally opposite so in case one of them fails the other one will probably rise in value.
What you're doing is basically spreading your money in 300 shitcoins which will all go down if bitcoins sneezes. Your diversification is not helping you stay with no worries even for a week, a coin going down is not being compensated by another going up and if something bad happens to the crypto scene they all go down!
Crypto investments are more or less akin to gambling right now but so are stocks. I am not sure what is the lesser evil though. Maybe stock up on precious metals?
That's true for any investment in this world! Be it a traditional stock or unregulated cryptos, both can be considered as gambling, especially for the day traders!
I personally believe cryptos can be a good choice for diversifying a traditional investment portfolio! In the regime of falling/negative interest rate, cryptos can really bring great value addition which can definitely help in fetching major ROI.
The simple quicker answer is YES, of course.
The complete one is: I can use a portfolio of multiple investment cryptocurrencies so that when price changes on specific alts i can switch to others and trade immediatly.
Taking changes of markets volatility and price fluctuation makes me a safer investor for not losing everything i invested for.
That's why you should divide your investment according with markets 24h cap and price value.
The complete one is: I can use a portfolio of multiple investment cryptocurrencies so that when price changes on specific alts i can switch to others and trade immediatly.
Taking changes of markets volatility and price fluctuation makes me a safer investor for not losing everything i invested for.
That's why you should divide your investment according with markets 24h cap and price value.
Cryptocurrency is a good investment as well so if you don't want to put all your investment in one basket then you can consider cryptocurrency. Wise investors always says that diversification is the best option to earn profit and of course to save your money from the black swan. You should also diversify your investment in cryptocurrency, a lot of good coins to be consider and earning profit is much higher if you have more coins in wallet.
yes of course the existence of cryptocurrency will increase investment options. the more types of investments that we participate in will give us many benefits. because we don't only rely on one type of investment. I myself have several types of investments the first I invested in crypto I have bitcoin and some altcoin. secondly I also buy gold and thirdly I also own property. of the three types of investment, of course, the bitcoin that provides the fastest profit. but I also know that bitcoin also has a high risk so I also invest in gold which has a lower risk.
Crypto investments are more or less akin to gambling right now but so are stocks. I am not sure what is the lesser evil though. Maybe stock up on precious metals?
Sure. Investing in stocks sure also has a gambling aspect too, but think about it. You're investing in businesses that actually has a working product and is running right now, versus 99% of cryptocurrencies which are mostly vaporware and are bound to fail sometime in the future anyway.
In my view, cryptocurrency can be a good addition to a mix of someone's basket of investments and as a way to diversify one's exposure to the marketplace. For the past many exciting years, cryptocurrency (not including the shitcoins, of course) has been giving good return of investment (ROI) though the problem is that this industry can be volatile from time to time that is why many can be afraid to stake a part of their assets in here. Notwithstanding the inherent risks, many fund managers and institutional investment platforms are already into cryptocurrency partly because other investment vehicles have been dull for the past many years, so they look for good alternatives.
I'm not a traditional investor so it doesn't help me to diversify. I only have my apartment, some fiat and some cryptocurrencies.
I'm not going to diversify by buying into stocks. I invest in what I know and understand and at this time its real estate and Bitcoin.
Stock market doesn't look attractive at this time and there's a high risk or recession. Many traditional investors would laugh at me but I find Bitcoin to be a very safe investment when my choices are between stocks, bonds, fiat currencies and real estate.
I'm not going to diversify by buying into stocks. I invest in what I know and understand and at this time its real estate and Bitcoin.
Stock market doesn't look attractive at this time and there's a high risk or recession. Many traditional investors would laugh at me but I find Bitcoin to be a very safe investment when my choices are between stocks, bonds, fiat currencies and real estate.
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It just seems like milennials and other risk-taking people who are actually invested in the crypto-scene, and the worst part is that a lot of those people are only invested in crypto-currencies. I personally think, going 100% in crypto is the worst decision you can make, and people need a lot safer holdings (like real estate).
You are right, and this is where the importance of risk management is. Even though cryptocurrency has a good opportunity for those who like to take risks, but plan B must really be prepared to overcome the worst. Dividing investment into several parts is one way to avoid losing all at once, as well as in investing cryptocurrency must be further divided into several coins and potential tokens. It just seems like milennials and other risk-taking people who are actually invested in the crypto-scene, and the worst part is that a lot of those people are only invested in crypto-currencies. I personally think, going 100% in crypto is the worst decision you can make, and people need a lot safer holdings (like real estate).
in fact each time a newbie mentions "portfolio" and "diversification" while saying their portfolio only consists of bitcoin and two dozen altcoins i tell them they have NOT diversified at all.
I saw them a lot of times, when they are asked about their crypto portfolio it's no longer a surprise for me if they will mention a lot of altcoins included to their portfolio which is around 10 or more. and real diversification is when you have traditional assets and then buy bitcoin alongside them to benefit from the huge profit that bitcoin gives you while still having one leg in the traditional market and enjoy the less risk that they give you.
I have understood this lately, real diversification is not just with crypto but you have to include the real-world assets and investments that we know. 
Most crypto-investors, like me and my friends will understand that the market is basically a gamble if you make money or not. I personally wouldn't ever invest in crypto if I had a lot more financial freedom, but so far I just put it off as a hobby and if I end up making profits, I sell and maintain my portfolio at a certain value.
Have the mindset that the money you have in crypto is already gone, and I would invest in crypto if I didn't have investments in more safer, traditional options.
Have the mindset that the money you have in crypto is already gone, and I would invest in crypto if I didn't have investments in more safer, traditional options.
I just posted an article on Medium to shed light upon diversification into crypto for traditional investors.
https://medium.com/velvet-capital/want-to-diversify-your-portfolio-adding-some-crypto-might-help-32c62eb402e?source=friends_link&sk=f6265fc28cad39fb0a86095e6d3cfc8a
Curious to hear your thoughts. Is the low correlation with traditional assets going to be persistent? What do you think?
It's going to be hard to attract more institutional investors, there is no question that a lot of them got burned by the market crash last year and there is a 99% chance they aren't going to be coming back in the game.https://medium.com/velvet-capital/want-to-diversify-your-portfolio-adding-some-crypto-might-help-32c62eb402e?source=friends_link&sk=f6265fc28cad39fb0a86095e6d3cfc8a
Curious to hear your thoughts. Is the low correlation with traditional assets going to be persistent? What do you think?
It just seems like milennials and other risk-taking people who are actually invested in the crypto-scene, and the worst part is that a lot of those people are only invested in crypto-currencies. I personally think, going 100% in crypto is the worst decision you can make, and people need a lot safer holdings (like real estate).
Yes, with cryptos I diversified my portfolio
I don't have only cryptos, I can't afford to invest all on BTC like some guys, I prefer to diversify and have my own business, my cryptos, my bank savings, and even my money under my bed
Yes we have to be prepared for any kind of situation
I don't have only cryptos, I can't afford to invest all on BTC like some guys, I prefer to diversify and have my own business, my cryptos, my bank savings, and even my money under my bed
Yes we have to be prepared for any kind of situation
I chatted with many traders, most people who are suitable for crypto trading will throw away their focus on stock/other, and choose diversification only from crypto. They understand the risks and like more interesting fluctuations.
both types of investment have high complexity so they are not confused if they only choose one. So the level of comfort in a portfolio is based on comfort with strategies that often find profit effectiveness.
both types of investment have high complexity so they are not confused if they only choose one. So the level of comfort in a portfolio is based on comfort with strategies that often find profit effectiveness.
Crypto investments are more or less akin to gambling right now but so are stocks. I am not sure what is the lesser evil though. Maybe stock up on precious metals?
I just posted an article on Medium to shed light upon diversification into crypto for traditional investors.
https://medium.com/velvet-capital/want-to-diversify-your-portfolio-adding-some-crypto-might-help-32c62eb402e?source=friends_link&sk=f6265fc28cad39fb0a86095e6d3cfc8a
Curious to hear your thoughts. Is the low correlation with traditional assets going to be persistent? What do you think?
It's easier to diversify one category because it's more efficient to monitor.https://medium.com/velvet-capital/want-to-diversify-your-portfolio-adding-some-crypto-might-help-32c62eb402e?source=friends_link&sk=f6265fc28cad39fb0a86095e6d3cfc8a
Curious to hear your thoughts. Is the low correlation with traditional assets going to be persistent? What do you think?
If you put crypto and stock together in my opinion a little more troublesome because the exchange hours don't occur for a whole week.
Pretty good article. You can tell outside investors interested in diversifying their portfolio with crypto because we starting to see crypto in the traditional stock markets online. I don't know too much about traditional stocks but I have seen cryptos being added there. This proves people are interested and I think it's important to diversify in different areas. Like crypto is an investment in technology of the future and should be in anyone's portfolio.
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