As everyone in the crypto landscape is aware, sometime around January 4th the market took a huge tumble. My portfolio was no different in this. This post concerns itself with my lessons prior to that point.
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My initial investments quickly started to boom. My $1000 investment peaked to nearly $1900 dollars in the span of two weeks. However, this was actually disappointing because 2 main mistakes led to quite a bit less than it should have been because my profit taking off scheme was faulted. My original thesis had been to pull off profits off booming coins leaving only the initial plus some amounts in them. To explain that:
Initial: $12.50
See a 3x: $37.5
Remove $22.50 Remaining Initial $15
Invest the $22.50 elsewhere.
This faulted in that each of the 3x I did this, the coin continued to grow while the coin that the money went to didn't necessarily grow. I think this was due to the market being so powerful. Looking back now, the lesson to be learned here was to remove the $22.50 if and only if the coin seemed to be dropping. Then hold that in bitcoin until the coin dropped and buy back in. That works by this
Say $12.50 buys you 1000 coins initially
If it doubles in fiat value, you still have 1000 coins
But if you sell 500 at that peak, and it drops 30% and you take the fiat money from the 500 coins and buy back in, you now have 1214 coins.
Then if the market returns to its price you sold at, instead of $25, you have $30.36. This appears to be the way to really bull up on money.
This relies on two things.
Pulling coin out and leaving it in bitcoin.
The coin not rising once you withdraw without dropping below your withdrawl amount.
The second main mistake I made was catching hype. This has worked for and against me. In the case of Stellar Lumens (XLM) this has been great. I put a big chunk of my invesment in Stellar because it seems to be a sound platform. On the flipside, I pushed a lot of my coin profits (from the $12.50 coins) into Verge (XVG). I decided to do this because it sounded like a cool product with a huge support group in the online community. What I found out though was that the company didn't really have much to back up their claims as far as their products and weren't the only crypto in that space! This led to disappointing returns, and a questionable future. I'll cover how I'm handling investments like this in a later post.
Thanks for reading.