Prepare Yourself Financially for the Event of Total Loss
While most amateur investors have a tendency to convince themselves that the investments they pick are a sure thing, history tells a very different story. The investment battlefield is littered with corpses of greedy investors who let a desire for more dictate their investment strategy, and they ultimately went broke. The most logical first step you can take toward becoming a successful investor, is ensuring you have amassed enough disposable capital. If you only invest capital you can afford to lose, your base standard of living will not be detrimentally affected by poor investment performance. Start by eliminating non essential items from your budget, and instead save that money to make investment portfolio contributions.
Investment is a near hopeless game for most people if you don’t know what or who you are investing in. Get to know the company, explore their team’s background, read customer reviews, and test their services or products. Do research on their market competitors, drawing comparison with those who provide similar services and determine whether or not your prospective investment has a fair valuation. Don’t buy into hype in a way that can cloud your judgement; you should always enter every investment opportunity with a healthy level of skepticism.
Know How To Properly Secure Your Cryptocurrency
Cryptocurrency theft was estimated to cost investors 1.2 billion dollars in 2017. Thankfully there are simple precautions you can take to negate the probability of theft, and keep your cryptocurrency investment secure.
Learn How To Identify Risks And Reduce Your Exposure
There is a lot of validity in the old saying, “no risk no reward”, but that being said – you have to learn to identify risks that are truly worth taking. If you go around investing in the riskiest stocks expecting there to be an equal amount of upside potential, you are in for a tough lesson. The most basic approach one can take in deciding whether the risk is worth the potential reward is to do a simple ‘cost benefit analysis‘. If you follow the advice of DNotesEDU and only invest what you can afford to lose, you shouldn’t be too terribly worried about the potential of total loss, and can therefore afford to place bets on riskier investments that have higher potential payouts.
Choose A Balanced Investment Strategy And Stick With It
Pick a balanced investment strategy and stick with it. Invest small amounts over long durations of time, allowing yourself plenty of time to adapt and tailor your strategy to changing market conditions. If you are a beginner investor it is best not to get overly technical, instead choose a simple approach that you can understand.
Watch Closely For New Regulatory Guidelines And Provisions
In an industry that is developing as quickly as cryptocurrency, regulators are not far behind and as such the regulatory landscape is shifting rapidly. There has been an extreme amount of misinformation circling the legality of certain industry aspects, so it is best to find a regulator who knows what is going on in your jurisdiction, and latch on to their guidelines. These individuals are capable of diagnosing problems and relaying that information to the public in a truthful manner.
Learn To Identify Various Scams
According to Satis Group research, 80% of ICO’s in 2017 were scams. Learning how to identify and avoid scams is the single most important aspect of cryptocurrency investing. Always be sure to do extensive due diligence, and research the people you are investing in. Simply looking into someone’s background can reveal a lot about that person or group.