Topic: Risk Management - page 8. (Read 2044 times)

Well in my opinion knowledge in what you are trying to invest is important you got to study and gain knowledge about a certain ICO that you want to engage with this is your money you got to be sure on what you are doing before engaging in buying tokens of coins, Second see for your self the people behind certain ICO that you will put your money into if they are well known or if they have done remarkable in their life and they are not involved in certain issues, And lastly what I am always gonna say and partially saying to newbies and certain investors on putting their money on ICO and Altcoins to invest at your own risk we can never know the exact risk we are dealing here you can sure invest in long term or short term your decisions will sure play a big part in your success.

I've experience also the lost in the market of crypto and bitcoins

big money was lost but soon after I have only a little money in my bitcoin wallet

then I just think positive and never stop understanding and studying the market

there's always a ways

to manage the risk in bitcoins and altcoins just do the following(this is my opinion)

1.before starting an investment with crypto and bitcoins understand how it works and understand the market behaviour
2.do not put all your money in one crypto experimenting and buying different crypto can save you when you lose in one crypto
3.Invest only what you can afford to lose do not invest big amount of money that you cannot afford to lose.
4.always think positive the markets always going down and down and down but sooner or later it will rise going up and up and up
5.patience is a virtue great things comes to those who can wait, cryptocurrencies are not one time big time scheme you need to work for it.

A risk is a scenario where you have something that you can lose. If you bought low and sold higher last year, you might have gained back your initial investment

Last year the price went up with over 800%

That is how you reduce or eliminate risk. Get your initial investment back and trade with your profits.

For me to avoid risk when it comes to an investment. We should be aware of volatilily 'cause it always happened and need to make some analysis what are the circumstance of market, which where the price will go such up and down to avoid loses,  and the most important is to control our emotions when doing trading 'cause i think that is the common reason why we risk because of our emotions.

When we're talking about risks, we're talking about decision making. There is no way you could eliminate risks because you're not the only entity in the market. As a simple components of the market, there are buyer, sellers and government(situational). These three all three are what manipulates the risk or decision you're taking. You can't stop nor control any of these components in the market because they're the one that makes up the market not just you. However if you would like to reduce the risk you're taking, you can manage your investments well and don't go all-in in a single currency. Invest in a lot of coins in the crypto market, so when a dip in price happens you're not all losses, however you should have the thought of the significance of quitting the market when you even know that it is unstable. Why would you sell in a crash, if that is just a normal phenomenon? In the first place, you shouldn't really need to invest in the crypto, if you're just gonna sell it all in that particular event.

retain, meaning to tolerate the occurrence of losses, to prevent the occurrence of investment losses, as a result of such losses are provided funds to cope (eg other unexpected cost items in the investment budget)

Maybe it's the initial reaction, bitcoin maybe the first in the market but when people realize that there are altcoins that has a better use than
bitcoin then we can get back their confidence again to invest. For me, I really make sure I can diversify my crypto investment as we never know if bitcoin
will remain in the number 1 spot all the time.

To avoids risk in investing here are some tips;
1. Do not invest in a single investment. Diversification is necessary. (Do not put all your eggs in one Basket, by Rick Warren)
2. Study the history of an asset/coins you want to invest. (You can note which month it has a dip. Most of the price history repeats itself.)
3. The portfolio/platform of the an asset (Better coin has always may not all have a better platform)
4. Their Vision and mission. (People without vision perish so as to the coins or assets).
5. The people behind the asset/coins. (Expertise, strategy and knowledge always bring profits.)

Hope it help.

While diversification is a good thing in most markets, in the Crypto markets it's really not so. If you are to buy bitcoin and 100 other altcoins and bitcoin crashes 50 percent, the other coins are probably going to go down a shit-ton too. So one 'sector' of crypto is to have problems or crash, most of them are going to.

We don't really have many industries here, we're not like the real stock market.

every job has a risk, and risk can never be eliminated, and that is a natural thing
and I think this risk is comparable, with the profit we get, from bitcoin
to minimize, we just need to be careful, especially when choosing, if you invest with altcoin, you should be able to read the coin chart, and instinct is in need, you must have a sharp instinct
and do not ever miss the news, we should always uptudate

In bitcoin and altcoin investment, hedging is good way to manage the risk because we know the characteristic move of bitcoin and altcoin.
Other than that, there is one more aggresive way, thats martiangle. It can recover or more loss quicker.

If you look at the risks that exist in every day life and compare the situation to crypto there can be some links drawn.

Look at driving a car, every time you head of onto the road you take a risk. Every day people die on the roads for a number of reasons, mechanical failures of vehicles, lack of awareness, lack of knowledge of conditions/rules. What do you do to minimise the risk minimise the potential effect of the risk. Pick reputable brands, only drive when your fit, learn the road rules of the country your in and have a look outside and drive to conditions.

Now compare these risks and mitigation strategies to crypto. Mechanical failures could be bad tech, so you pick a reputable brand. Bitcoin is well established and has a strong reputation. Look for trusted products and people.
Lack of awareness - do try and trade when your tired, dont make impulse decisions, think about what your doing and be in a state where you can really evaluate.
Lack of knowledge - do your research, i think crowd theory can work here to a degree. listen to and read as much as you can so you can make informed decisions. Keep on top of the current market, is it bear? is it bull? has something just pumped? has something become oversold.

Most importantly dont invest more than you can afford to lose.  

I only trade with disposable income and have a firm belief in having zero debt.   No mortgages, no credit lines, even my credit cards pretty much just sit there unused unless it's to purchase airline tickets or pay for hotels so as to accrue mileage points.   I also am invested across a dozen or so relatively independent markets.   So when my crypto holdings lose a third of their value in a month, I don't have to think to much about it.   I certainly notice it and yeah, it doesn't feel great to lose even if it's on paper, it's not something that is earth shaking.   

All investment have a high risk because in investig we talking about money,liability,asset and etc. too many people dont know how to minimize the risk because they are lack of information of 1 company/banks/crypto/any other business.
If you taking a high risk situation in the field of business it means you are gambling wether you can have a good profit or have a big loss.

Investment is a matter of risk. If you don't want to risk try not to invest. We don't know what will happens to our investment and even we take care to what we will invest and knows how to manage risky thing, there are investment that fools us! I believe that investment is a gamble, you need to sacrifice just to make gain. It is not about the risk management, it is all about the luck of yhe person who will invest.

Diversification and dollar cost average. Buying a fixed dollar amount on a regular schedule. Once a week, every two weeks, etc... And don't look at the price every day, a person can go crazy doing this.

1. calculate total of your asset do you want to invest (calculate too those asset that you've already invested in ICO and even that have been already in all of exchanger)
2. make a percentage (BTC, ALTS, FIAT) mostly different asset have different percentage or which one is become the biggest asset
3. when you want invest, just invest a money that you can to lose it, of course big risk big profit, but i wont that a risk like that, i more prefer to split it to other type of investment, not just all in at one place

Eliminating risk? Stay in fiat and accept inflation eating away on your savings. Minimizing risk? Know yourself and don't do anything stupid.

This means:

1) Understand what you're buying.

2) Don't invest into something only because it has risen.

3) Don't exit a market only because it has declined.

4) Understand what you're buying.

5) Invest only as much as you can afford to lose.

6) Prepare enter and exit strategies way in advance.


Number 1) helps preventing you from doing stupid things. If you don't understand what you're buying, you're just gambling. If you understand what you're buying, but know it's shit... you shouldn't be buying it in the first place. If you understand what you're buying and are convinced of its merits... number 2) and 3) will be less likely to affect you. Number 5) helps alleviate your psychological burden which makes it easier to not do stupid things. Such as 2) or 3) for example. Same goes for 6).


Note that hedging only helps if your hedge actually acts as one when shit hits the fan. Historical analysis may help the process, but could still fall short.

Note that diversification only works if what you are buying is worth investing in. A diversified bucket of shit, is still a bucket of shit.

Hedging and diversification.

Risks are inherent or always there whenever we talked about investment especially Bitcoin and the whole cryptocurrency community. But how do you deal with these risks? What are your experiences or even techniques in managing risks? In minimizing risks or even eliminating it?