Bitcoin Forum

So I am in a situation where I have found a potential project I can invest in for the long term and gain huge profits.
At the same time the current market seems the correction is over and another bull run might start.

I am having an urge to invest all that I can in the potential project I like but it is also a good time to diversify the portfolio and trade some nice coins to gain short term profits.
What would you guys do if you were in such a situation ?

---

@mk4
how long you're planning on holding
I can hold very long. Let's say 15 years or so.

what your other investments are(inside and outside crypto)
BTC and ETH
Little amount in Mutual Funds

what your asset allocations are
Not sure how would I describe that

what your trading strategies are
More of swing trading. Buy the dip, wait for a good price to sell (time doesn't matter)

what your risk appetite is, and how much money you can afford to lose
I can afford to lose not more than 25%

We have no idea:

• how long you're planning on holding
• what your other investments are(inside and outside crypto)
• what your asset allocations are
• what your trading strategies are
• what your risk appetite is, and how much money you can afford to lose

Unfortunately only you can answer this.

Yes, The current market correction is most likely over and we may see some bull moves during this or next week IMO. Investing and trading both are good at this position. But I will vote to investing more than trading. Because when you invest any project right now, maybe after some months you can get a huge profit if you can hold it strongly. On the other hand if you trade, you can not get profit like that. Because most of the time when trader do trade they try to close the trade with a little profit. And after closing the trade we see many time those coin go even couple of X in a day.

So investing is better at this moment. Yes to increase the portfolio trading is good point but you have to aware ,tricky, experienced during the trading period.

There's your answer. I'd say put 10% in if it's a good project and less if it's higher risk.

A good project that fills a niche shouldn't matter how much you put in first (eg if you do 10-100x on it, then you've doubled up at least just from the 10x.

You're also less likely to sell at a loss if you don't care about how much you've put down.

---

If you want to rate your portfolio, call the mutual funds an asset type 6, bitcoin and eth of type 7 and new coins/low caps of 8 and cash derivatives of 1.

What proportion were 1, 6, 7, 8. What proportion are you happy with (eg I normally treat crypto on its own but did you lump them all together to get 25%)?

Depends on how good you are with trading.

Given how good I have been in trading (not 95% but above average), If I were in your shoes I would go in 50% for trading and 50%for investment. Investment also involves risk just like trading. What matters is the risk/reward ratio.

Diversification is also good, you never know what could happen in to the world economy the next 10-15 years. I think you saw what happened in the recent COVID-19 crisis. Lots of startups, companies and businesses collapsed. You don't want to go all in without any plan B.

Please never go into one project with all of your savings. Always diversify.

Your diversification does not need to be mix of long term and short term investments but it can be mix of multiple long term projects as well.

If you are able to cope up your life along with multiple long term investments then I guess you must go for that. (Also I believe if projects are too good then you can easily convert your long term plans into shorter one at any time you need).

Hope you are already into bitcoin investments with long term plans; I guess you must continue and must have more than 50% of portfolio only into bitcoins with both long and short term goals.

Your other answers aside, this is the one that says a lot. On your cryptocurrency allocation, you should probably mostly go with BTC and ETH(I'd personally go mostly BTC but you do you), and only allocate a really small percentage into those low-cap coins, and also a really small percentage for trading. Take into account that BTC and ETH alone can potentially drop 70% (not saying it will, but it's definitely not outside the realm of possibility).

Trading knowledge is also needed before investing. Because people who invest in crypto inevitably need to know the basics of trading. choosing a 50% trading strategy and 50% investment is the right choice. Risk ratio is also important. all of that is also accompanied by the main strategy and the backup strategy. Investments may be in the next few years will provide more returns.

I don't think so. Investors do not need to go for technical analysis but only fundamental things are more than enough to choose the right things. Nothing changes because of you are going to invest in cryptos; investments are common across different domains still you need to make sure about the potential of your asset and nothing more.

Yeah, probably that may work. But, when considering bitcoin and its unbeatable ROI, I may not go for trading with 50% of my capital. Just 10% or 20% will be enough to risk in trading.

If you are skilled in trading, then you have little to worry about, just trade as that will bring you quicker profits since you ultimately hope to make quick bulks.

But if you are not a skilled trader, then you better diversify the fund and increase your potential coins portfolio.

If you see that project is really worthy that you think it will be a success in the future, then it's up to you to go all-in. There's no specific time when you will take profits but if that's a new project, expect at least a year unless they will aggressively put some big liquidity on their market.

There's no exact strategy you can follow because it depends on the flow of the market. That will be your task here, to monitor your own investment.

I believe that it's better not to think about sticking to your investment because nobody knows what the future holds.
If you believe that your desired project has a lot of potential and you'd like to wait, then going for the same holds higher significance because you're sure that it'll definitely give you better returns. But if you're interested in taking risks, then you may diversify your portfolio and invest into more than one coin only.

Depends on you since you do have your own input when it comes to projects that you are eyeing because not all would really be having the same mindset or jurisdiction
on how they would rate a certain project if its good or bad so its up to your own choice.If you do choose that project then it depends on you since its your money after all.
You might get some advise on here but it isnt ideal that it would be heavily affecting your own decision.If you do seem that this project would pump or explode out
then go ahead and as long you do know when it comes to risk then theres nothing to worry about.

I would certainly diversify my capital funds. 30/70. 30% for trading and 70% on investing, This will all depend on the skillset in trading you have and the confidence you have in projects/investments you are seeing. Since you said that you can wait for a long time, The 70% funds on investment would certainly be diversifying also on different projects and as you said mutual funds.

15-years is a long period of time. You can trade with 50% of your balance to maximize the profit with the minimum risk. Doge is a good coin to trade for a short time. Taking advantage of leverage trading also gives you more chances to enter a trade (2 options: long for buying and short for selling)

But before everything, you have to learn to trade. It is mandatory because with knowledge, you will be able to make more right decisions

People have different thoughts about this so find your own.

As on my own thing, I don't want a single coin investment but rather diversified it on several coins I trusted so in case of fallout on one, I still have other options.

Taking profits at the right time is crucial and that's what we need to focus on.

It's very crucial to invest in new projects but if you see that there is a potential to gain a profit in the future, why not?
Each of us here has a different point of view in investing either it is a new or existing project, always remember that the new projects is always risky top put your investment and why not to choose those projects that already exist, proven and already tested, all you have to do is to wait for a perfect time frame of having a good profit.

Crypto price movement is always unpredictable, we dont know what will happen in the future. Taking risk is I guess your best decision and diversify your investment into other potential projects, it's your money and it's your call.

Well, if you're trusting yourself for that project and see that there's really a potential, invest only what you afford to lose. It's very important to check yourself if you're all in to it and you won't have any regret doing it. As much as for the projects, I'm becoming careful with them because my experience is bad but it could be different for you and you might be better than me. If you think that you have enough btc and eth and you want to get into project that you really believe and that's what you desire and you've done enough research on it, do what you think is right and better for you.

If you are really confident that the project you are going to invest in will let you make huge profits then I will refer to just invest in it, don't take extra risk for short term gains especially if you are a long term investor.

Or you can also put that 25% amount into short-term allocation since you can afford such amount so just play with it to make short-term gains while the 75% should be invested on the project you wanted to invest in, diversifying investment mainly needs to diversify your capital amount too.

The market is in a time when many guys don't know what to do. Buy or sell, hold or trade, invest or trade, take care to be safe or gambling.

It is a chaotic time and if you are not sure what to do. Exit your position and keep your capital in fiat. It is the best for your case.

Exit means you won't get more profit. Is it bad? No.
Stay and get losses together with pressure of uncertainty. Is it bad? Yes.
Stay and hope for profit with no idea how your position will end. Is it bad? Yes.

If you believe in the market and let your position opens or hold your coins, accept any short term or few months of losses. Accept such bad results before you decide to hold or invest now.

If you can not accept it, keep all your capital in fiat.

What mk4 said. And mostly, you should follow your gut and belief and only blame yourself for your mistakes.

---

If I were in your situation and have funds to invest in anything that I want, I would allocate it in different percentages. So based on your answer that you cannot afford to lose more than 25% of your portfolio, I think, the best way.
*Not a financial advice

Determine your priority projects: 50%
Determine your interested project: 25%
Bitcoin: 25%

You could play with any amount and percent that you want, but I think this is ideal for diversifying your portfolio with different assets.

Always keep in mind that you can put it all in one and get a promising return, just like the investor who puts his life savings in doge and becomes a millionaire. It can happen if your promising project is like that, but you have to be firm on your decision because it doesn't happen to everyone.

Not just you, I am seeing lots of other people as well are taking wrong example with dogecoins. I am completely contradicting here for two reasons. I never suggest anyone to go with all in one, even with bitcoin-ling-term investments. Diversification is more important to ensure sustaining profits among all market and other scenarios. The second one is, what dogecoins provided to its investors is something mythical and it may again happens only in dreams.

I am seeing getting into both investing and trading as a kind of diversification; so going for both at your comfortable percentage will ensure your progressive growth in your networth.

15 years ? that means you are sacrificing the moment dump that happens all the time. I thought wasn't that too long for a hold? I prefer to hold but when the price goes up you can sell and take your profit.

I have the same thought, we don't know when doge will repeat history and soar higher. besides we focus on certain coins, indeed holding other coins will share the worst risk, so we won't panic if one of the coins is dumped. and one more thing that I think about, when there is a pump, then I will immediately release it to take advantage, because I don't like investing in the long term

If you had planned to inverse money in cryptocurrency,you should skip of stock market.If you start to believe something,kindly believe it fully and hold till it recover.Don't exchange money from the invested asset for the emergency need.It should be skipped to avoid of loss.Mostly the new traders do this and suffer a lot after the mistake.To escape from loss,patience is needed one in trading.

The key advantage of diversification is spreading out risk factor. So, it is always advisable to hold more than one coin still holding bitcoin in bigger percentage will not affect you in any negative manner. Right now I am holding more than 10 coins and tokens but holding bitcoin for more than 70% of my portfolio.

For the case of most altcoins, your strategy must be the right one; for example I missed to book profits in ada when it was trading around 3k satoshi but right now it is trading around 2.3k satoshi which makes me still holding it.

That must be kind of new interpretation of the diversification. I appreciate that. But not sure it will be viable for me because I'm not focusing on trading but only investing.

Don't get too much emotional because what you see is might different 10-15 years from now. Think about how volatile we are and you can't assure that particular project will give you something big profit in the future if you will hold. As have you said that you are willing to hold for 15 years and the question is if that project will still exist?

If that you wanted to hold that long and can afford to do that, much better to choose Bitcoin or Ethereum, or BNB, not new projects that have not been proven and tested yet.

Invest what amount you can afford to lose that's all i can say., because on this matter only those hodler who really sacrifice and take all the risk can achieve their goals and succeed when it comes investing especially for long term.. "Except those experts because they are good on it no need to worry." Lol
But when it comes beginners? Its highly recommended to take advantage with some trusted projects or coins such what you've mentioned above because for sure you can make profits even long term. Unlike unknown project or new emerging projects wherein unpredictable and the best suggestion to it is to invest what you can afford to lose only because its so skeptical.

In my opinion, even though it is a very good and promising project, don't invest it all. Invest according to what you can afford to manage, because there are many other needs later, so you can use 50% of your shares or assets to invest in the project. Not hoping badly, but unexpected events are true, we just need to prepare for it, because sometimes we do not escape from a mistake.

For short-term trading, don't get too obsessed with it. When you have started trading our money, don't expect to get big profits, think about the risks. Usually, the money I will trade, I consider lost and it is not mine if I lose later. To avoid regretting excess and causing stress later, don't trade money that you are not prepared to lose. Trade money fairly, don't really want to get big profits, so we don't think about the risks that will await.

Good point, there's also chances that what we are expecting to happened might not favor us, future always have surprises.
But also review and assess what happened 10 years ago, if the market continue being progressive the chance still high to gain good compensations.
Then the process of doing your research and analyze the project is very important, holding long term assets needs strong foundations.
Top 3 crypto that already have big supports from, investors, developers and traders. Huge chance to succeed.

I agree that with an answer to the above points you will better know what would be more appropriate for you.

With complete disregards to personal circumstance, I would always advise a strong portfolio diversification.

If a project is crazy good then go for it but don't lose sight of what's exactly right under you.

you will need to diversify but at a smaller ratio. just ten percent of your portfolio should be your diversification. thats the pattern i use. you dont need to hold much token but you need to buy a little of any potential coke you hold.

I’m not into trading that much because I have a limited time in the market so I tend to buy and hold for a specific period of time. Most of the time I took profit as early than expected because of some circumstances so I don’t think I can hold for straight years because I believe the market will always pump and dump, so taking profit at the top and buying at the bottom is my priority, this is a smart hodlers for me.

That is depending on our preference and we make decisions depending on what we think is right. Besides, there is no urge for everyone to do long-term holding nor to have a short-term goal also. That is how important to analyze the market trend, we don't hold if necessary and we do selling also if it is a need. We don't need to be a hero and save the market and hold even it dumps, it is an option to sell just to save some rather than to lose it all.

Do understand that none of the idea I'll share here are that of a financial advisor and they shouldn't be considered as an investment idea either. They're just ordinary ideas therefore you shouldn't based your decision on what I have said. Having said that, I understand you intend holding that coin for over 15years, that's a very long time and there would definitely be some ups and downs moment for the project.

Instead of locking up your funds right now, you can do the other which is trading some quick profits taking coins as we're in the bull run and everything is green. You can make some profit that'll contribute the the funds used in investing in that project if your choice.

Or probably instead of going all in now, you can fractions your capital, used some for investing and others for the trading, as you make more you reinvest in the project over time.

But in my opinion, if we are holding bitcoin then definitely we are contributing for the growth of bitcoin ecosystem overall. Holding is not only benefiting the holder but it will lead to a sustaining future for everyone. Still it is individuals' preferences like when someone is desperately needing money, we cannot expect them to be persisting with their all holding.

Like some other people have mentioned above, we should build our portfolio with the mixer of both investing and holding; it's a kind of diversification that will definitely lead to big benefits over the time rather than just depending on only one.

That is a good idea.

Many cryptocurrencies are still in the bullrun. (chuckle)

I think diversifying your portfolio is the best thing to do. For me it's too risky to put all your capital in one emerging project or something similar. Invest some in the existing  coin with real use cases.

Is the project really that good? If it’s as good, then you can invest in it. And by the way, you said you’re into swing trading and then you also said that you can hold for fifteen years. If what you’re doing is swing trading then you don’t have a specific time and can sell even at the shortest time once you have made a profit.

And moreover it would be good if you have mentioned the name of the project, I think the community can help you look at it, unless you’re already confident enough that it’s a good one and you don’t have to ask. And try to control your urge, don’t spend on the asset too much than you can afford to lose, know your risk level that you can take and stick to it.

But, I don't think there will be any mistake if anyone will be investing/trading both in stock and crypto at a time. It means you can be successful even in these two sectors if you are planning your investments or trading properly. There is nothing here about believing in to one thing completely; you can believe into two things completely because that will be more profitable for you.

I suggest anyone to go for both investing and trading at a time because it will give you more chances to make good profits regardless of what will be the market conditions.

Since you intend to invest in that project for a very long time, it is wisdom to know that it is necessary to provide a means of income that can provide for short term needs. Personally, if you'd ask me, I'd say that the best option in this situation is to diversify.
I'd say you invest a large percentage of it, say 70%, into that project and the remaining 30% into active trading to make some short term profits.
Secondly, it's too risky to put all your eggs in one basket. It's very easy to lose all in the case

Well, that also depends on your capability and since we know that trading could really hard if you don't have an interest about this. If I'm going to choose which once either trading or investing, I should have to choice investing since I already know myself that I'm not good in trading. Maybe I look to that someday but as I've said, that only happen if the interest still there. Because you can't underestimate trading and you can't tell that was an easy job coz mostly many were ended badly.

I believe this is the common scenario of most people here. I mean most of the people here are already into investment but very rarely keep trying in trading because of lack of knowledge and skills in trading and at the same time they might be profitably doing with investments as bitcoin is a proven asset for long-term investment.

I am having my portfolio based on 90% into investments and I have only less then 10% into active trading. This doesn't mean I am good at trading because I am making use of long-term trends which may be lasting more than a month of time whereas my holdings are just sleeping for years to get me massive profits after 5 to 10 years.

Very true !

If someone is good at both stocks as well as crypto then it's only a good thing as he will be able to gain profits from multiple sources.
It's not about belief but about what suits the needs of one and how it benefits him.
I am personally exploring both stocks and crypto and right now I am more into crypto.
Investing more and trading with a short amount for now.

I have seen and read about people selling their houses all in an effort to have enough money to buy crypto and if am to answer OPs question with this example, this has to be an investing urge though there isn't much of a difference with having a trading urge.

Putting risk into the picture, this is a nice strategy!

Stocks is something I have never tried. Good to know, these days people are investing into both stocks and cryptos as a time; because people will choose higher ROI based only; in that way crypto must be the choice for many people nowadays.

Yeah, I am also coming across many such news. Honestly I am not getting surprised on seeing them. Moreover in my view, they are in right direction to buy back 2 or 5 houses after some years of holding cryptos.

15 years is a very long time we are talking about. Even if you blindly trust the project and even trust the promoters even a single mistake can lead to abandoning of the projects. I am saying this keeping at par with most of the startups in the world. Most of them have great ideas but it doesn't just require a great idea to succeed. So putting all your investment in that particular project for a period of 15 years is nothing less than stupidity. That also at the time of a bull run because we know for a fact that when BTC prices would go south in bear market the whole market would go red.

Also seeing your risk aversion which is good 25% I think you can try to trade your way out. In just 1 year or so you would be enough trained to take money anytime out of market. Then in future you can invest this money in that potential project at time of bear run where you might find better prices.

The more the better right? but dealing with both markets would turn out to be stressful even though you are fully aware with the market but doesnt mean that executing trades would be that easy.

If you are a type of trader who do make out swing trades then it wont be an issue but being active on both markets then that would be an another story. Honestly, you can make out

comparison in terms of profit between those both markets and im much sure that you would take seriously on dealing with crypto yet its no denial on how much it can possibly give gains on you.

I mentioned before that I was leaning a little bit into investing in stocks, but I heard as well that it was falling when the pandemic started that's why I didn't bother to continue.
Somehow both are obviously different, but due to convenience that I can invest in crypto, specifically Bitcoin, I just went along with it and didn't bother investing in stocks anymore.

If it might start to bullish then you should check it if its already at the dip before it starts because once you put in a very critical level it might go down constantly as well.. Remember to follow the basic rules even its for long run investment coz that's how it really work. So to prevent losses instead of gaining massive profits better to study the coin itself.... And invest what amount you can afford to lose coz in such coin it still unpredictable how much you can make in the future and still very unpredicted what will be the situation afterwards..

Since it's a long term project I would rather give it a 40% investment while I trade with the remaining 60%. Chances are, if I'm focused and that good at trading, I'll probably double my capital in no time and now I'll have more funds to invest in the project. The initial investment was just incase the coins skyrocket so I won't be left out of the party.

Now if when you want invest, the coin has risen to some incredible price then you'll just have to wait for a correction, it might not fall to your initial buying price but at least it'll give you an opportunity to enter the trade and don't forget you're in for long term so the profits will always be certain provided you made the right selection of coins.

I haven't tried to invest in stocks yet as it's hard for me to understand it. I am more into cryptocurrency trading. It's much easier for me to trade/invest in altcoins that have potential and promising to rise. In the future, If I get a chance and got a good budget, I want to know more about stocks trading as I think it's needed more money for stocks trading compared to cryptocurrency trading.

I am sure that you will never need to know about stock trading as I'm seeing you are already doing great with the cryptocurrency trading. I mean only if you are not good with cryptocurrency trading in terms of level of profit making from it, you might need to think about switching over or extending your trading into stocks.

But, when you're investing/trading only with good potential coins then I believe you will never need to go beyond cryptocurrency trading. For example, I am comfortable with my bitcoin holding even I am making good profits only after years of holding and waiting; I guess I will never think about extending my investments into stocks. But, I may choose the real estate kind of the traditional investment as part of business and investment as well.

but diversify our assets need to do , we know bitcoin or cryptocurrency provide huge profit potency , but in stock did it too. personally i will split some my money into stock although i am already get alot from bitcoin and other coins. remember, in crypto we still facing hacking problem which is could suffer us anytime. maybe in our exchange or our own wallet.

These are some confusing moments for investors when there is dilemma where to invest money to seek high returns in future.Here are some options you can choose as per my opinion(it's just advice as I am not professional trader):

1)If the project you are talking about has potential and offers stable and high returns and it's worth risk taking then you can surely invest your money in that project after all your judgements.

2)Bull run seems to be over and you can invest some portion in altcoins also as they are rallying very high this time and touching ATH like ETH,ETC,DOT,BNB.They are potential coins and can provide you short as well as long term profits if you trade effectively between the candles.

3)If you want and can Hold Bitcoin for long term then it's one of the best option because we have seen high returns of 100-200% this pandemic so just imagine returns in 15 years when we will pass 3 halvings also and there is no risk of 25% but 2500% return can be there for you.

4)Don't invest in Mutua funds at this time because economies are hardly effected and stock market will take some time to grow and same is th case with your funds.Moreover you will be getting 10-15% annual returns which are far less than crypto market keeping in mind risk and volatility factor.

That is best the decision to take but I don't chase having a huge return like 100-200%, I felt so bad with that knowing that not all the time the market is in the bullish season. And I don't want to fool people who think that they can easily make money in Bitcoin and multiply their investment quickly. No, because it was not the real happening inside.

15 years holding? I can't imagine if someone could do that without having some temptation to sell?

If you are very confident about the project and willing to hold it long term, then go ahead, invest all. You would be risking everything. Either its going to change your life or you are going to drown in regrets (and financial problems).
But if you have doubts, then instead of investing everything on that "potential" project that you found, how about spreading your investment? Invest like 50% on the project and trade/invest rest in bitcoin and other well known altcoins. At least you won't be risking everything.

- Knowledge in stocks is difficult to understand when the influences in this market always start from different corporate regulations, strategies, politics and economic perspectives, there are almost a lot of factors that require us to have a clear explanation in order to be able to invest. Crypto is more about demand and novelty, it doesn't stick to too many regulations, people like it and it will increase in price, investing is also easier to understand, if crypto disappears in the future, I will be able to redirect but otherwise, here getting benefits is still a good plan

Replying to the main post

Your capital to be invested or trade should also be considered in the factors to make a reasonable choice. Though given the statements you said, I would say that, it seems that you know the investment will be long term and you are positive with the trading route, then;

Go seperate your capital 3/4 to 1/4.

3/4 to trading cause it seems that you're postiive that it will give you positive results, plus it is short term, and;

1/4 to investment for now, cause its long term, then invest your profits from the trading you done to this.

WIN WIN

I would never recommend that; why should we go for do-or-die kind of risk?

There are a lot of opportunities are available which will be helping us to diversify our portfolio so that we could earn in definite way rather than risking all at one opportunity which may hit or may not.

Both investments and trading are highly unpredictable which is the reason we are going for multiple options to ensure we are having good returns in average at least.

I'm seeing a lot of people are going all into bitcoin and sharing like they are enjoying good profits because of bitcoin's strong rally on every four years. Still, I agree with them because they are planning for long-term like for decade of holding and not just one or two years. It means we can go for investing into only one thing but that should be bitcoin and more importantly should be for very long period of holding like 10 or 15 years.

At the end of the day everything depends on what you think it is going to be the performance of that project you are talking about, it is true the market of altcoins is doing well but that should be a point against investing in the project you are talking about, dogecoin now is the fourth coin in terms of market cap and it may even reach the third spot in no time at all, and when the market is moving like that it is preferable to invest in altcoins that people are interested in at the moment as this excitement is not going to last forever and you could miss on some impressive profits.