Steemit Crypto Academy Lectures week-6 By Professor @stream4u || Homework Done by @preshdan

Hi friends, it's my pleasure to participate in week 6 Lectures and Homework by professor @stream4u

• HomeWork Task 6

Make a Homework Task 6 Post on the below Topics which you can discuss according to your views on it.

Differences in Large Capital - Mid Capital - Small Capital and how they will affect to the Investment?

source

Cryptocurrencies can be broadly classified into “large-cap”, “mid-cap” and “small-cap”.

• LARGE CAPITAL

Large-cap cryptocurrencies have a big market capital and as such are safe investments to make. Only a companies with more than $10 billion market capital could be categorized or classified large-cap companies. Moving by that estimate, as of writing, only Ethereum, Ripple and Bitcoin are classify as large-capital cryptos.

Large capital Cryptocurrencies are however widespread large market capital that presents a much better safe investment in its trade.
As a result of the quantity of liquidity in exchange, Large Cap market normally have a chief support in the event of long time trade. There is a very slim chance, if not impossible, of loosing investments in this market platform and generally, Large Cap is less exposed to risk.

• MID CAPITAL

These are smaller market capital as to compared the large capital markets which have a higher probability of risk than the large capital. The class of Companies within this Cap are companies that have between $1billion and $10billion market capital.

This is a mixed breed type of market i.e, a combination of Large and small capital market.
Here, there is capricious ways of loosing funds which warrants adequate research before making any investment. A certain number of its coins have the ability to survive while others may diminish over the years. This is due to the risk involved.

Since Mid Cap has the capacity to increase capitalisation potentials, there is also high liquidity flow such there is higher growth potential than is obtainable in Large Cap. This is as well one of the main reasons why Mid Cap have more risks.

• SMALL CAPITAL

This is the smallest market capitalisation with the highest rate of risk as to compare Large and Mid capitals and there are higher chances of failure due to the volatile nature of the markets.

There is lack of exchange boost in Small Cap and Small Cap and is traded due to the smallest possible amount of liquidity. This class of Cap scarcely launch new products and even when they do, they die off in the exchange added to zero force of liquidity by investors.

Small Cap has traders who, though with high risk, come only to cash in and out the system thereby depriving the system of liquidity. This is a poor investment platform resulting from the incessant rotation of low capital and oftenness of in and out trade which also makes the platform a more risky one and poses a threat and perhaps, a trap to neophytes.

With ROI recovered, there is high potential of doubling up assets in a very shortest period of time, dissimilar to what could be offered by Large and Mid Cap in their short time. This is the reason why there is still influx people in this market.

CONSIDERING RISK & REWARD

• Large Cap

Investments made in Large Cap crypto will mostly not experience significant growth but is however considered a safe and lesser volatile investment. So, while there may not be major gains, investments may still have some small conservative growth.

Cryptocurrencies are much more volatile than traditional stocks. Consequently, large-cap cryptos may however still have a larger scope of growth than large-cap shares.

• Mid-Cap

Mid-cap cryptos have a lower market-cap than large-cap and also have a much greater growth potential than large-caps, which is also why it have more risks. Mid Cap has more growth potential because they may still be in the stage of increasing their market utility. Meanwhile, these are not in anywhere near their full potential.

• Small Cap

Due to their low market capital, these cryptos are likely to be affected by the fanciful impulse of the market. This means that, investments in them can depreciate to a negligible amount in an instant.

Nevertheless, Mid Cap has the capacity to explode in value and give huge returns on investment much more than what Large and Mid Cap can give. One of the main challenges with Mid Cap is that an investor has to do a thorough research on everything before making investments.

• Your view, Which type of Asset capital can be more profitable? Why? Advantages and Disadvantages. (Explain only 1)

Answer: Small Market

I would go for SMALL CAPITAL owing to its capacity of doubling up profits in the shortest possible time, despite it is risky. The major aim of every investor is to make profits within the possible shortest period of time and not necessarily wait for a very long time just for the purpose of making conservative profits.

Merits of Small Capital

The great amount of profits that can be made within a short period of time is the reason why investors still go in and out irrespective of the supposed high risk on small capital markets.
There is a tendency that investors have the capacity to even triple their Investments in a very short while.

Small Cap does not actually require much liquidity to invest in such trade, thereby making it much easier for investors to take full advantage.

Disadvantages of Small Capital

The issue of insufficient liquidity in exchange propels this type of market as a result of outflux of assets.

Often, there is zero pulling down of assets which poses threats on the lifespan of assets due, assets could die to uncertainties from investors or of high market volatility.

Thoughts on Risk Capital and Penny Cryptocurrency
In my own terms, Risk Capitals are real means of long time Investment. This is a kind of capital raised by putting together inappropriate expenditures which have no effect on routine savings. Since it has no risk, it could be as well called social capital. Assets used for such investment has no direct effect on personal finances.

Penny Cryptocurrency are assets that have a very low market value which is priced between $0.0004 or $0.02. They seen to be very undervalued assets. Buying more measures of such kind of assets using the Risk Capital could be life transforming as it brings about unthinkable and conservative profits.

What is the Role of Watchlist? Best way to set Watchlist. Additionally, For Example, show your watchlist if you have configured it and give a short description of it

ROLE
Beyond doubt, the role of watchlist in Cryptocurrency has proved to be more important in the tracing of performance and cryptocurrency. It permits one to build a list and have selected favourite icons to monitor for enhanced performance. Automatically, the watchlist allows one and in brief to have informations about trends and other important news on cryptos.

BEST WAY TO SET WATCHLIST
A fundamental plan not to stay far just because one making a watchlist is by choosing a certain number of assets from the various classes or layers of market capitals, inclusive of the Large Capital, Mid Capital and Small Capital markets respectively.

(Watchlist for coins regularly checks)

CONCLUSION

Although market cap could be good metric to estimate how valuable a cryptocurrency is, there are several other factors that should be taken into consideration. Market cap is one of the major tool to look out for before making Investments. Thorough research on the project of interest and asking questions to have full knowledge of growth potential is essential. Knowledge of market cap helps to get one so far.

Thanks for task as it has also widened my knowledge on the participated topics discussed. @stream4u, this is my entry for week-6 homework task.

Cc:
@steemcurator01
@steemcurator02