Cryptocurrency investment has worldly spiked over the last five years, with 14% of Americans now holding digital assets in their portfolios, up from a reported 1% in 2016. Some of the crypto experts predict that this figure is likely to double by the end of 2021 after 13% of survey participants expressed the desire to purchase crypto over the next few months. Here are a few of the top 5 crypto investment tips to get you started.
One of the easy ways to reduce risk and improve returns is by investing in crypto assets. This is trading is known as asset allocation or diversity. The common strategy is to select different types of cryptocurrencies to ensure you gain when one of the many sectors experiences a surge.
Copy trading is a type of investment trading where you automatically copy the trades of a professional investor. This is a completely hands-free way to trade cryptocurrency without needing to study and track the market yourself. You cannot predict the success of a trader or the future movements of crypto assets so it is crucial to set up a loss limit.
DeFi staking is a way of locking up your crypto assets in special, autonomous platforms known as 'decentralized applications' in order to receive annual interest. DeFi is a sector of the cryptocurrency industry that takes traditional financial services like loans and insurance and puts them on the blockchain. DeFi staking is a great way of generating an annual return on your deposited assets if you only plan on buying cryptocurrencies and holding them. It is worth noting, however, that not all cryptocurrencies can be staked.
Hedging is a type of investment strategy aimed at reducing potential risks and losses incurred during adverse price movements in the market. The popular way crypto investors hedge their trades is by going long or short in the futures market.
Initially, approach the market with caution and buy the coin you feel surer about. DStick to your decision and monitor your progress before expanding the portfolio.
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Disclaimer: Analytics Insight does not provide financial advice or guidance. Also note that the cryptocurrencies mentioned/listed on the website could potentially be scams, i.e. designed to induce you to invest financial resources that may be lost forever and not be recoverable once investments are made. You are responsible for conducting your own research (DYOR) before making any investments. Read more here.