In life, the only certainty is death and that's why no one could be sure over anything, we could only speculate and hope things go our way. That's why the concept of a backup plan is essential to everyone who has a plan in the first place. Make plans for situations A, B, C, and D because life could be so unpredictable.
Speaking about unpredictability, some people have a shitty Xmas and a quiet new year due to the fact that they poured all their eggs in a basket. yeah, you guess it right, some people are so dependent on just the investment they have made in the crypto space and that's really a bad move if you ask me. The need for the creation of options is important and everyone should inculcate the habit of creating them even if they are not going to need them if the first plan works out perfectly.
Still, on crypto being the only plan, I must confess that it is quite risky because no one could 100 % predict the correct price for a token and you never can tell when you are in urgent need of quick cash. Let us paint an instance where you invested $10,000 and the market dipped, making your initial capital now worth $5,000 and you need urgent cash of $4,000.
What happens in this instance is that you are currently losing half of your crypto investment and you need to still take out of the remaining cash to treat your urgent needs. that automatically means that you have lost at least $4k since you are withdrawing and it is still not sure if the $1k left will germinate into something meaningful.
In that sense, the concept of diversification becomes key toward falling in this type of scenario. I am not talking about diversification of your coins in your portfolio, I am talking about diversification of your investment in another industry i.e real estate, agriculture, and even consumable goods.
The diversifying of your investments leads to the creation of options for you and this will help prevent you from being in tight angles that could have been prevented in the first place. coupled with the fact that diversification helps hedge against risk and most times leads to an optimum profit.
The diversification and all leads to the creation of backup plans and that's the way everyone should be thinking. Think beyond just one source of income and also create plans alongside a backup plan to make you dry during the rainy days. Thanks for reading and the support.
Есть ли у вас план, мистер Фикс?
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