I want to raise an issue that our team uses in the cryptocurrency market. One of the best ways to get the most profits out of cryptocurrencies is to create a portfolio. In fact, portfolio management can minimize your risk in the process of investment and trading. So now, we want to address what portfolio we need to build to achieve our investment goals.
The most important features of a good cryptocurrency portfolio for investment:
* A portfolio must contain at least ten coins or tokens.
* Look for items that have real existence in 2018!
* Convert the amount of capital into five parts and enter only one part of it into the business. Keep the four parts as a backing in the form of a tether; one of the safe places to keep the Tether is the close option wallet that is available on our site.
* A good portfolio contains at least ten items between 1 to 500.
Table of Contents
- 1 Cryptocurrency arbitrage portfolio strategy
- 2 Strategy description
- 3 Calculate the exit point in profit
- 4 Calculation of the loss point for exit
- 5 Doing martingale in cryptocurrency loss conditions
- 6 Important points in making a profit in the cryptocurrency market (or at least not losing in the cryptocurrency market)
Cryptocurrency arbitrage portfolio strategy
In this section, we want to provide you with a comprehensive definition of cryptocurrency arbitrage portfolio strategy. You may have heard about arbitrage in Forex and even binary options. Arbitrage means that you choose a broker or binary options site that is slow and has a fast price source, and when the price jumps in the fast source, you buy or sell. Of course, in practice, this method is almost obsolete in the world of Forex and binary options (speeding up servers, so on). But in the world of cryptocurrency, there is a paradise for arbitrage that may not be described!
Well, now that we know about arbitrage, it’s time to move on to the strategy.
We consider the approximate maximum price of $ 20,000 of bitcoin in 2018 as the base price (although Bitcoin saw this price for a short period of time). Now let’s look at the crypto. Then we compare its price ratio in 2018 with the $ 20,000 bitcoin in 2018. Suppose bitcoin was around $ 20,000 at its peak in 2018 and bitcoin cash was around $ 4,000; in other words, bitcoin was five times the price of bitcoin cash. We now consider the current price; Bitcoin at the time of writing this article is $ 60,000, and bitcoin cash is $ 600! In other words, bitcoin is 100 times the price of bitcoin cash!
So, with a simple comparison, we realize that once the bitcoin cash was one-fifth of the price of bitcoin, and now it is one hundredth! In other words, Bitcoin Cash has the ability to increase twenty times and is suitable for our portfolio. So, we choose ten similar items that have a suitable coefficient and safely divide the $ 1000 capital into ten parts, then start buying (suppose $ 100 bitcoin cash, $ 100 Zcash and….)
Calculate the exit point in profit
The most important point in this strategy is the exit point; our recommendation is the amount of profit in proportion to the Fibonacci numbers. Suppose you make a 38% profit from a portfolio. The next step is to exit the trade and work on a new portfolio again. If you do not find the right portfolio, wait for the perfect conditions to occur. Of course, now that the market has good dynamics, our recommendation is 61% profit. In other words, when you make a profit of $ 610 on $ 1,000.
Convert all cryptocurrencies to Tether and wait for the new position (note that one of the safest places to store Tether is the Close Option wallet. In other words, you can easily do this in the Close Option Dashboard by selecting the Deposit option and then withdrawing Tether later).
Calculation of the loss point for exit
The probability of loss in this strategy is very low; However, be careful, as mentioned in the section of “The most important features of a good cryptocurrency portfolio for investment” above, you should log in with one-fifth of your dollar-tether capital that you have earmarked for this. In this case, in practice, if you lose (almost impossible), only one-fifth of your money will be lost. In other words, this strategy does not need an exit point by engaging only 20% of the capital.
Doing martingale in cryptocurrency loss conditions
Suppose about 38% of your portfolio was at a loss. In that case, it is recommended that you re-invest another 20% of the capital, make exactly the same amount you bought, and consider the profit exit point again as 38% of the total involved capital.
For example, you bought $ 1,000 out of $ 5,000 of the hypothetical capital of ten coins or tokens ($ 100 each). Now your portfolio is at a loss, and out of a total of $ 1,000, you own about $ 620. Now is the time to buy again, that is, $ 100 for each coin or token you have previously purchased. Now the total capital involved is $ 2,000, which at the moment you own $ 1620, at a loss, (i.e. your total portfolio). The exit point should be around $ 2740. so $ 740 out of $ 2,000 is enough as a profit (38% $ 2,000).
Important points in making a profit in the cryptocurrency market (or at least not losing in the cryptocurrency market)
* Note that in this market, 95% of market participants are the loser! Everything requires science and strategy, and high-risk financial markets like cryptocurrencies are no exception.
* Never extend profitable strategies to high amounts without trying in low amounts.
* Always consider the risk and enter an amount in this market that you can afford to lose.
* The most important thing to make a profit in this market is money management, and if you enter the market with all your money, there is a 99.99% probability of losing the money in a long time.
* Do not engage your money during periods of market downturn and when the strategy is not profitable. Wait for the perfect conditions to appear.
* Always remember that the cryptocurrency market is the nature of a large global stock market that is likely to collapse overnight. One point to remember is that nothing is as secure as your money in US dollars. Therefore, you should always respect the involvement of 20% of capital so that the long-term result of your work with the collapse of the market is positive. Definitely, this strategy will repeatedly generate you 61% profit on the cart. Now, if once 20% of the capital was lost in bulk, you are in a good profit when the big market collapses!
* This market is not a place of stubbornness, and certainly, those who involve emotions in the time of loss and deviate from pre-determined profit-making strategies will certainly experience a big loss.
* Do not use leverage at all and buy directly with your money. Leverage increases your excitement as well as your risk and leads to losses. It is better not to see the portfolio directly from the place of formation after forming the portfolio because it is possible to touch or trade it and ruin the work! To see the portfolio, you can use the virtual portfolio that you create in the portfolio section of the Coin Market Cap site (it is free).
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