Portfolio management. Rebalancing.

[crypmike]

In the management of financial assets, there must always be a plan. This way you will form and fix your vision of investments, and it will become clear what to do in one or another situation. Without a plan, you can either behave too passively about the market or make unnecessary mistakes.

The first thing we'll talk about is Rebalancing. The point is that at the beginning of the period you choose the proportions of coins from which the portfolio will consist and after this period you return the balances to these proportions.

The market is developing by cycles, one or another coin raises, falls, so while you using rebalancing, you ensure yourself from losses in such market behavior, making growth equable. This way we follow “Buy cheap, sell high” principle.

I do rebalancing in the middle of every month. This process includes

• Selling coins which enlargened their percent
• Buying coins which went down
• Getting rid of coins which disappointed m

First of all, I decide which part of my funds I’ll leave in BTC, which part is in alts, and which will be spent on new coins, trading, and ICOs.
For me, I've chosen that it will be 10% on ICO, trades and potentially interesting coins, and 90% are either long, or they are waiting for more promising projects to replace them.

I separated coins into few groups:

• BTC
• High-cap alts (mcap >2B USD)
• Mid-cap alts  (500M-2B USD)
• Low-cap (100–500M USD)
• Micro-cap (>100M USD)

These values are quite conditional as market capitalization changes every day.
If to break portfolio in percentage parts, for this market I stopped on these amounts (choose your own):

• BTC — 40%
• High-cap alts  —20%
• Mid-cap alts — 10%
• Low-cap — 10%
• Micro-cap — 10%
• ICO & etc. — 10%

I want to overtake whole market growth so as soon as it will become bullish, I'll invest the majority of my funds into more risky cons with good potential.
Finally, I have such a table (the only example — you can choose your own values):



I do my rebalancing in Google Sheets, using their integrated ability to set up formulas (How to do it).

As an option, it's possible to have some part of your funds in fiat to buy crypto during market dumps. Here everyone decides for himself.

This simple trick will help to look at portfolio management from the new side and to avoid unnecessary risks.

The Spreadsheet Example https://docs.google.com/spreadsheets/d/1_76KigwUqoYtDswrkooSJUJE-cvGHys3LHAoukgFNhA/edit?usp=sharing

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[Bolt Brownie]

Thanks for this post. It actually has some interesting thoughts. I don't hold to many coins right now, so I can't really do this, but you are are saying makes sense to me, and if I ever get more serious about trading, and start investing in multiple coins, I will try to put this in practice.

[Jeremiesaranza]

I like your approach. I'd put more percentage in the type of coins you understand better. Let's say I play microcaps mostly, so I keep 50%+ in them. However, such a tactic will not insure us completely from possible losses, unfortunately

[atrocityx]

Really good post, I really like your %s and your reasons.. awarding merit.   Good for providing the template as well, I may try to adapt something similar for my own portfolio for analyzing. Thanks.

[CybereyesWinger]

In the management of financial assets, there must always be a plan. This way you will form and fix your vision of investments, and it will become clear what to do in one or another situation. Without a plan, you can either behave too passively about the market or make unnecessary mistakes.
....
...
If you like this post, support an author with merit. Thanks[/i]

   With the coming quantum technologies, the current market must experience many changes. To be more exact, many coins will leave the market, as there will simply be no demand for them, due to the same technological superiority. Without certain experience, Trading and Hodling are risky. The most acceptable method of investing at the moment is ICO. For a more successful contribution, you need to carefully analyze the project. Identify is necessary for the market side. For example, the Kelvin Blockchain project has an innovative method of encryption, transmission, storage, and security. All this is based on quantum computing. Thus becoming in demand in the future.

[berrygood]

Interesting, but isn't rebalancing in every month so much? I think coins may decrease though there is no reason that lead to it, so if you bought a good coin like eth, no need to sell it if it goes lower.

[aervin11]

The idea of "Rebalancing" is pretty great and the benefit of getting an average gains for your portfolio is assured but the thing is there are certain updates/news(FA) of those holdings that might take your profits away. Like the next day listing or burn that causes a massive price hike for that holding but you already sold it to average down your losses buying other coins on your portfolio, those scenarios might be rare but it happens. All I see in this "Rebalancing" method professionalism which I would prefer to do when I wanted to get in the sphere longer and avoid any losses than hitting huge profits.

[okocrypto]

I love your approach and I will work on something like this for myself when the time is right. The only area I will adjust a little is the percentage for ICO. Mine will be a little higher than 10% because ICOs have proven to be more profitable way of investing especially when you select projects carefully.

[Gururapyco]

Holding such a big variety of coins is definately a very safe option but won't bring you as much profit as it would give you if you'd choose only 4 to 5 of them.

[Ekenegbu123]

I must say that this is a professionally balanced portfolio and a portfolio with good money management. This was very helpful and I wouold be looking forward to balance my own portfolio there as well

[charlotte04]

In the management of financial assets, there must always be a plan. This way you will form and fix your vision of investments, and it will become clear what to do in one or another situation. Without a plan, you can either behave too passively about the market or make unnecessary mistakes.

The first thing we'll talk about is Rebalancing. The point is that at the beginning of the period you choose the proportions of coins from which the portfolio will consist and after this period you return the balances to these proportions.

The market is developing by cycles, one or another coin raises, falls, so while you using rebalancing, you ensure yourself from losses in such market behavior, making growth equable. This way we follow “Buy cheap, sell high” principle.

I do rebalancing in the middle of every month. This process includes

• Selling coins which enlargened their percent
• Buying coins which went down
• Getting rid of coins which disappointed m

First of all, I decide which part of my funds I’ll leave in BTC, which part is in alts, and which will be spent on new coins, trading, and ICOs.
For me, I've chosen that it will be 10% on ICO, trades and potentially interesting coins, and 90% are either long, or they are waiting for more promising projects to replace them.

I separated coins into few groups:

• BTC
• High-cap alts (mcap >2B USD)
• Mid-cap alts  (500M-2B USD)
• Low-cap (100–500M USD)
• Micro-cap (>100M USD)

These values are quite conditional as market capitalization changes every day.
If to break portfolio in percentage parts, for this market I stopped on these amounts (choose your own):

• BTC — 40%
• High-cap alts  —20%
• Mid-cap alts — 10%
• Low-cap — 10%
• Micro-cap — 10%
• ICO & etc. — 10%

I want to overtake whole market growth so as soon as it will become bullish, I'll invest the majority of my funds into more risky cons with good potential.
Finally, I have such a table (the only example — you can choose your own values):



I do my rebalancing in Google Sheets, using their integrated ability to set up formulas (How to do it).

As an option, it's possible to have some part of your funds in fiat to buy crypto during market dumps. Here everyone decides for himself.

This simple trick will help to look at portfolio management from the new side and to avoid unnecessary risks.

The Spreadsheet Example https://docs.google.com/spreadsheets/d/1_76KigwUqoYtDswrkooSJUJE-cvGHys3LHAoukgFNhA/edit?usp=sharing

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I just buy those coins that are good enough to have a comeback in the market. And I do sell some coins that are mostly lost its value before it goes to low or lower than that.

[Herbert2020]

try adding a new row only for comparison's sake and in that row include a what if scenario when you only invested all your money in bitcoin and never bothered with the notion of "portfolio" and then try calculating how much money you could have had in you did that. it can be an interesting factor specially in the long run.

[crypmike]

try adding a new row only for comparison's sake and in that row include a what if scenario when you only invested all your money in bitcoin and never bothered with the notion of "portfolio" and then try calculating how much money you could have had in you did that. it can be an interesting factor specially in the long run.

yes, of course, its necessary to investigate and compare such kind of things

[damberg]

It is a very helpful post. I started a true portfolio rebalancing a month ago, and I am looking forward to how it performs. I have seen some comparison between "buy and hold" strategy and portfolio rebalancing - from historical point of view PR should perform better.

[Kevin77]

try adding a new row only for comparison's sake and in that row include a what if scenario when you only invested all your money in bitcoin and never bothered with the notion of "portfolio" and then try calculating how much money you could have had in you did that. it can be an interesting factor specially in the long run.

That would be a very interesting factor indeed. At least, with such kind of factor, you can correlate how you are doing at the moment compared to how you should have done if you go the other way. There is always the need to have an informed decision or will I say a feedback on your strategy which is why correlations like this are always important. I would really suggest this factor as well, but all in all, it is a good thing for the OP to be sharing such a brilliant strategy.

Holding such a big variety of coins is definately a very safe option but won't bring you as much profit as it would give you if you'd choose only 4 to 5 of them.

Choosing only 4 to 5 of them does not mean on the average you may have more or less than choosing all what he has chosen. What is important is to just choose the number of coins you know you can handle and then stick with them as you keep managing your portfolio like the OP did. It is a good strategy and good of him to share it with the community as a lot of people may not even understand what re-balancing is all about and how it can help them.

[Maricurijohn]

To balance, you should buy, do not pay attention to the market, just buy when the market drops and sell when the coin increases, that is the strategy I do and apply in this time.

[crypmike]

now it could be even more actual

[BlueStackz]

To balance, you should buy, do not pay attention to the market, just buy when the market drops and sell when the coin increases, that is the strategy I do and apply in this time.

I think this is about the maximization of the profit you are talking about. About the management of the portfolio and the rebalancing, you can get enough information on the search engines. What I think can be effective is the allocation of capital to invest in assets according to the profit ratio.

The more as asset gives profit, the more you allocate funds for it. But in the same time, invest in the rest as well and this diversification tends to reduce the risks hence the management.

[cryptic4000]

wow, this is the plan I want to do in the future. I have made too many mistakes now and the reason is that I can not manage my finances. I think your financial management will help me a lot in becoming rich. thank you.

[RadekG]

wow, this is the plan I want to do in the future. I have made too many mistakes now and the reason is that I can not manage my finances. I think your financial management will help me a lot in becoming rich. thank you.

I think you'd better learn some lessons from such financial asset management, but not use it fully at your portfolio. You must independently develop your strategy and test it.
And rebalancing is really great.

[Scompe_BTC]

wow, this is the plan I want to do in the future. I have made too many mistakes now and the reason is that I can not manage my finances. I think your financial management will help me a lot in becoming rich. thank you.

For a successful trade and good output, portfolio management is very important because it helps you approach your profit. IN addition, the more efficiently you deal with the market in terms of the risks and the profit, the more good would the output be.

[rationotled]

try adding a new row only for comparison's sake and in that row include a what if scenario when you only invested all your money in bitcoin and never bothered with the notion of "portfolio" and then try calculating how much money you could have had in you did that. it can be an interesting factor specially in the long run.

yes, of course, its necessary to investigate and compare such kind of things

Well you cannot ignore the importance of management in business and when it comes to portfolio management, it is probably inevitable to pay attention to the portfolio management and this is one among many instruments thorough which you can make money.

[rickadone]

I have been trying the 50-25-15-5-5 method, for those of you don't know it is as simple as it looks and sounds. You put 50% of your money into one thing and that becomes your main source of income and put 25% into another thing which is there to prevent you from having a bad trouble with the 50% one.

You put 15% into something that looks promising but not quite there yet (think of early dotcom amazon type stuff, it was known that amazon was a good company but it wasn't known HOW GOOD it could be) and you get 2 very dangerous looking pink sheet type of stuff at 5% each and they are most likely busts but in the off chance that they become huge you get a lot of money in return. I tried this with 50% bitcoin, 25% ethereum, 15% dash, 5% nano, 5% doge but as you might imagine all of them dropped in price.

Maybe I should start with 50% stocks, 25% crypto, 15% gold, 5% forex, 5% something.

[Gibreil]

I made also my portfolio but it ruined when I sold my biggest shares due to my lack of money. I made it only for a short term period because I cannot take my family to die in famine. I work in this industry because I want to live happy not because I want to invest for a life time. Though, I want to invest some in the future.

[crypmike]

up, maybe somebody haven't seen

[bakasabo]

My portfolio consist of:

40% BTC
25% Ripple
15% Waves
5% Stellar
and the rest is TRX/EOS (bought it when it was traded at 18$  ) / NEO.

Maybe it is wise to sell something (even with a loss) and bought something new to cover losses ?
What do you think?