It's no secret that Hive has a higher APR than a savings account. It's also riskier because Hive prices fly up and down all the time. Basically, it's a high-yield high-returns kind of deal.
If you trust the project to keep increasing the value of your money, and you accept the risk, many of us put a percentage of what we own into Hive and use it to earn curation rewards.
However, most people don't have the time to check Hive 24/7 for things to vote to get the best efficiency on our votes. There are three solutions that most investors fall into.
- Delegate your HP to a curation project and get the curation rewards in the form of a scheduled transfer.
- Hire someone to vote for you and get the rewards as HP
- Follow high-voted authors and high-quality voters on hive.vote and get the rewards as HP.
Many curation projects pretend to be the solution to everything, and will sell you their snake oil, getting you to delegate to them. Many of them don't have good terms, and you will end up losing a lot of returns, at a higher risk, than you could have if you had done a little research.
As I have already done a little research, I will give you some facts and tools to help you with your investment.
Percentage of rewards
When you do the voting yourself, you get 100% of the rewards of your votes. This is obvious. However, if you're not a talented voter or don't have the proper tools, there's a high chance that your money won't make as much in returns as it could. In this case, you can delegate your HP to a curation project and have them find the proper posts to vote, and then they'll give you a percentage of the rewards they make with your money.
Many of these projects will promise you 100% of the vote. Others will not. A curation project, for example, posted a comment on one of my posts to promote its service. They offer 80% of the curation rewards they make. I know that I would get more, for example, if I delegated my money to @ocdb instead (I believe they redistribute 100% of the rewards made with delegated HP back to its owners).
Vote efficiency
However, knowing the percentage of rewards you will get is not the definitive measure of quality. A bad-quality voter could offer you 100%, and a good-quality voter 90%, and if the latter is way more efficient, you will get even more money back than you would with the former. Therefore, you must do some research.
Here, I will offer you a couple of tools that you can use to judge where to put your money. The first is hivetasks.com and the second one is hivestats.io. Let's take a look at how they work:
HiveTasks.com
HiveTasks is a Hive mirror of the old Steem tool called SteemWorld (not usable on Hive but on Steem).
After the @ in the link, type the account name that you wish to research (for example: https://hivetasks.com/@ocdb). Scroll down to Coming Rewards, click Curation Rewards, and you can see the person's voting efficiency. Do this with any voting project you wish to delegate to or follow with your votes on hive.vote.
HiveStats.io
This is a more complete tool, which shows not only the curation efficiency but an estimated APR (Annual Percentage Rate, basically which % of your money you make back in a year through curations).
Efficiency
APR
The comparison stage
Many projects urge you to delegate to them, but we first have to research. Let's compare a few projects as an example. Again, I'll show you the results of the curation project that offered me to delegate my HP to them in exchange for 80% of their curation rewards:
Again, they offer me 80% of the curation rewards they get from each vote made with my money. My average efficiency is instead the following:
And I get 100% of my own rewards (clearly, I'm the one voting). Therefore, it would not make sense for me to lower the efficiency of my HP from ~104% to ~60% (80% of 75%).
Now let's take a look at @ocdb's voting efficiency:
If your interest is not only to make money, but to promote good content as well, OCDB is certainly a good choice , as they reward good quality content with votes, while other projects are not as scrupulous and will upvote anything as long as it's efficient.
Additionally, if you were, for example, to follow my votes and upvote anything I upvote in order to be more efficient than the average investor's 60 to 70%, you would end up making a number that is not very dissimilar to OCDB's, maybe a tiny bit more (I'd estimate 85-92% efficiency). If you were to follow OCDB's votes, your efficiency would be very low (50-60%) due to the curation algorithm.
My thought process
Here's what I would think about when considering my choices. Let's say the choice were between following the votes of this hypothetical @cryptosharon or delegating my HP to @ocdb. I would not be the one making the votes, my rewards would be controlled by the whims of OCDB, and when I pull out my money, I'd be bound to a 7-day nothing-period where my earnings would be null. I could instead earn the same, but be free to stop at any second, and if I find a more efficient voter, I could change my trail on hive.vote to that account in a flash.
The reality
However, the matter doesn't end here and there are many more accounts that are voting out there. If you look at people's wallets and see a lot of rewards coming in, check out where it's coming from. Don't pick a lazy choice to manage your savings. This is a long-term choice, and it will decide how much you make long-term, for a year or more, or however long you stay. You could have 11% APR or 6%. Hive is not low-risk investment, so if you're counting on these funds for the future, take care of them.
What I do
I follow a couple of high-efficiency curation trails. I changed one for another today and expect my own efficiency to rise at least 10% by the end of the week. That will put me at 30% higher than if I were delegating to OCDB, and 55% higher than if I were delegating to the first curation project I mentioned.
I pay attention to a lot of things on the blockchain, and I'm quite tech-savvy. If anyone wants a guide about the best way to follow someone's votes, or about any related topic, throw a comment. I read them all. I hope you found this useful or at least entertaining.