I have only entered the Cryptocurrency market on 23rd Nov 2017 (which is when bitcoin at its all time high of $8k before passing the $10k mark and hitting $20k recently). In a short span of 1 month, I have grow my portfolio to 7x and has cashed out my initial capital with some profit leaving the rest of the money inside the market to grow. Below is the snap shot of the before and after. I have even reached $9k+ at some point of time.
One main reason why I could do this is - "It's a BULL market"!
In a bull market, everything you buy will fly, whether it is a sh*t coin or a potential coin with purely ideas or a working project with great potential.
I wouldn't say I'm good or everyone should listen to me as I'm not a financial advisor or expert. I had been trading in normal stock since 10 years ago and experienced the subprime crisis that burned alot of people. Before the bear market, we have experienced the same thing where everything you buy will eventually run up. And when the bear sets in, you will find it hard for things to fly up. Once it fly up, it drop down fast again. But in a bull market, high can go higher and there's no limit.
Another reason is - "It's still a very new market!"
With $500B market cap, it seems alot for every normal being. However, if you take a look at Facebook market cap alone, it's already $500B. If this Cryptocurrency is going to replace fiat in the near future, $500B is considered very very tiny. For Cryptocurrency which is a worldwide affair, $500B is nothing. Total market cap for equities worldwide is $61.9T. Hence, we are still 100x less than the world equities market cap.
We still have much room to grow. For the Cryptocurrency market cap, it has grow significantly in 2017 since March which can be seen on coinmarketcap website. And we see a strong injection of fund worth of $200B around early Nov to boost the cap to $500B and hitting all time high of $625B before pulling back.
It seems to be pushed by by the whale (big financial institution with huge funds) - To be discussed in separate article.
Thirdly, I have diversify my portfolio with equal amount of fund into 10 different potential coins. Each coins have their own potential and it would be not so easy to 'guess' which is better as there are many factors to consider. Hence, with a diversified portfolio, we will then be able to catch the wave. If we throw all eggs into one basket, if this coin does not move, we will be very depressed seeing all the rest flying up and missed out on the opportunities.
Seeing how the angel investors invest in their money, gave me this idea. If they put aside $50M of funds for start ups which is high risk high return, and diversify into 100 different startups, their risk is minimized by 100x. With due dilligence in choosing the good ones, if one rise up to the top to give them 1000x return, they would have made 10x gain with just one of them rising to the top instead of throwing all $50M in one so call solid one (which may fail).
This happened to my portfolio when one of my coin Verge rise up to the top with more than 30x gain! True that we have to HODL, but to grow faster, we have to analyze the potential for it to rise further. When one rises too fast, it needs to take a break before moving forward again. Hence, I have re structure my funds accordingly and cash out my capital so that I would not have any emotion trading in the Crypto world.
Next is to do research on the coins that you are going to buy. Does it have a strong team, potential project, and strong hype? Has it rise up high already? High can get higher, but always buy on dips and during consolidation (when the chart is flat. Meaning the price remain as it is for a few days). Buying those coins that are not already at the peak will give you more potential. And also look for those that has a lower market cap. For bitcoin, it seems to have rose alot due to the big numbers that catch media attention and has around 50% market dominance. It's dominance has been greatly reduced due to the altcoin (other coins) gaining some of the market share. The altcoins will have a bigger gain compared to bitcoin. Hence, by not chasing the top and parking your fiat at the base, you will be farming your fruit by letting it grow when it was being bought up in time to come.
Lastly, I have learned from past experiences and with the Crypto term of FOMO (Fear of missing out), FUD (Fear, Uncertainty, and Doubts) and HODL (Hold on for dear life), I constantly remind myself of all these basics and look for coins that have great team, great idea and great potential with great group of community (in telegram group). At the same time, I constantly learn from everyone else in the market and observing everyone's emotion in various group to understand the market better.
Also, I have eliminate my greed to earn fast money by only investing 'play money' into the market. This will make you have lesser emotional baggage. If the coins can run up 16,000x in a year, why do you need to be greedy to throw in your entire saving so that you have bigger payout? A coin as it is two-sided, one flip will turn things around and instead of 16,000x, you may get your funds divided by 10x or even 100x. Using 'play money' is like using the amount you think you can afford to lose playing this game.
Using money to play games, you will only get pleasure but you will never get your money back. Hence, with this mindset, you get to enjoy and have the potential of getting huge return. Isn't this great?
Please feel free to comment and if you like what I share, please upvote and follow me.
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