In one way, shape, or form we’ve all heard that it’s bad to be greedy.
But when everyone who’s in this marketplace seem to be returning over 50% MINIMUM, it can be REALLY difficult not be greedy. In fact, you might think of yourself as stupid for NOT jumping on the coin which has just rallied 500%.
So I’m here to tell you that.. no, you are not stupid. In fact, I think consistently making gains above 30% can pervert our understandings of what capital gains should really look like!
So as my friends and colleagues all seem to be piling in to this wild wild west of crypto- investing, I wanted to outline the practices that I use which have brought me a decent degree of success over the years. I hope some of you will agree with how I approach crypto investing and would love to hear your own points on what’s made you successful (or not) while being part of this community.
Point #1: Don’t be greedy!
Set your personal “required rate of return” and stick with it. It doesn’t matter how many times the people on reddit or steemit are shouting “TO THE MOON” or “HODL! Don’t let the euphoria of a strong bull market cloud your senses! Pick a target price you’re comfortable with and have some conviction to sell if the price of ______ coin ever hits that number.
Start taking profits once a coin hits your target goal. You don’t need to sell everything, but start selling portions of your stack in increments for every % that a coin’s price exceeds your target price. Aka use dollar cost average selling.
While using dollar cost average, you won’t experience the full potential gain as if you’d sold at the absolute top of the market, but be realistic, it’s impractical to assume that you’ll be able to sell at the top on a consistent basis.
Lastly, and this can be the hardest to do… but don’t beat yourself up about NOT selling at the top. That is the definition of greed. As long as you’ve hit the number you set for yourself previously, that is all that matters.
Example:
In the recent run of ANTSHARES from $5 to $50 dollars, I had a stake in ANTSHARES at $5. I told myself that I’d be VERY comfortable selling with 100% gains (in retrospect that’s pretty greedy) and started selling during the first 100% jump from $5 - $10. I cashed out 25% of my stack during the first jump and for every 25% higher, I'd sell another 25% of my stack.
So you know, I peaked at selling around $20-25... and while ANTSHARES blew up to $50, I had the peace of mind knowing that I got what I came for (even more so actually!)
Crypto investing can be one of the most exciting things ever, but I always like to tell my friends to be realistic about the gains they should expect to achieve. Everyone wants to get in early on the next Bitcoin or Ethereum, but don’t let that kind of tunnel vision of making 5000% misguide you from realizing true gains! You know, 25% here, 15% there (little victories)… can go a long way.
Stay safe guys and gals!
Cheers!
HK
Disclaimer: I do not intend to give investment advice in these articles. I only hope to show others how I think, act, have performed in this marketplace, and further hope to spark conversation on what others believe to be good discipline.