The Importance of Income Diversification for Crypto Traders

[wxa7115]

Since the retracement of Bitcoin, the market has become boring. Sometimes, the direction of Bitcoin is unclear. For example, the price action of Bitcoin is actually confusing. I have learned one thing in these recent days: As a crypto trader, do not rely on trading as your only source of income. It is good to have another source of income like real estate, staking, crypto jobs, mining,  and other legitimate sources of income. If I say that I will force trade now, it can end up in a loss.


What is your take on this?

There is not much to say as for the majority of the traders out there this should be their reality already.

Only a minority of traders can trade as their main occupation, as that will require a great deal of skill on their part and an amount of money so large that it will allow to them to pay all their bills with only a fraction of their profits, and the number of traders that can do that as you can imagine is not very high, so the rest have no option but to look for a second or even a third source of income, that way they can avoid trading when the market is not moving much.

[Ndabagi01]

Since the retracement of Bitcoin, the market has become boring. Sometimes, the direction of Bitcoin is unclear. For example, the price action of Bitcoin is actually confusing. I have learned one thing in these recent days: As a crypto trader, do not rely on trading as your only source of income. It is good to have another source of income like real estate, staking, crypto jobs, mining,  and other legitimate sources of income. If I say that I will force trade now, it can end up in a loss.


What is your take on this?

Do you mean as a crypto investor, they should have multiple source of income and not just rely on their investment in bitcoin? As a crypto trader, you can always trade the market base on the result of your analysis of the market. You don’t have to wait for the market to be on uptrend or downtrend before you can execute a trade. If you’re an experienced trader, you need to just analyse the market to enter a buy or a sell base on the direction of the market. Only a novice trader will be bothered of this because they won’t really understand the market and might enter a trade wrongly. Multiple source of income is for those that depends on trading for their income and can also do without them when the circumstance does not favour them at that time.

[slaman29]

Not really responding to non-trading income but I think I'll do a favor and let you guys in on dirty secret. Income diversification doesn't include direct income from trading itself.

The only people who make profits in trading are commission earners (from referrals), course subscriptions, signal subscriptions, market makers (from spreads).

You want to make money from trading? Don't trade. Do all this above

[CageMabok]

Portfolio diversification is important. But the worst thing about it is packing lots of shitcoins like the one being promoted with a post on this forum. There are some shitcoins that are meant to be successful, but we all know the ones that are outdated with the ideas behind them. Some coins' ideas are disgusting and disappointing. So, holding those kinds of coins and expecting them to pump is a waste of time.

When you already know that having a few Shitcoins will only be a waste of time for those who expect a lot when holding Shitcoins, of course this can be quite a valuable lesson for them when they don't get anything when they have wasted more time to expect more things through Shitcoin. So now is the time to choose something more certain, such as Bitcoin and several other popular coins which are generally quite well known in the crypto market. So stay away from any Shitcoin and stay on the right track like on Bitcoin.

[maydna]

Do you mean as a crypto investor, they should have multiple source of income and not just rely on their investment in bitcoin? As a crypto trader, you can always trade the market base on the result of your analysis of the market. You don’t have to wait for the market to be on uptrend or downtrend before you can execute a trade. If you’re an experienced trader, you need to just analyse the market to enter a buy or a sell base on the direction of the market. Only a novice trader will be bothered of this because they won’t really understand the market and might enter a trade wrongly. Multiple source of income is for those that depends on trading for their income and can also do without them when the circumstance does not favour them at that time.

If they are a crypto investor, they will search for many potential coins for their investment. They will start to invest for the project that looks promising to gives them the profit. They will not just have one investment type but they will spreads their investment in many coins that can increase. They will be careful choosing the coins because many coins can not increases for a long time so they will be careful to select the coins and research that before they decides.

As a trader, they will try to learn many lessons about trading and practice so they can improve their skills which can helps them to analyze the market. They will also search for the other sources of income because they know that can gives them more money and more knowledge so they can increase their income.

[tygeade]

There is not much to say as for the majority of the traders out there this should be their reality already.

Only a minority of traders can trade as their main occupation, as that will require a great deal of skill on their part and an amount of money so large that it will allow to them to pay all their bills with only a fraction of their profits, and the number of traders that can do that as you can imagine is not very high, so the rest have no option but to look for a second or even a third source of income, that way they can avoid trading when the market is not moving much.

Not only it would require a skill, it requires a dedicated focused time as well, which isn't that easy. This is why there are people out there who trade only for 1-2 hours a day, that's it. Main reason is that if you want to make any money from trading professionally, then you need to be locking your eyes on the screen, and looking at the charts very carefully, even a tiny miniscule information can't pass you without you noticing, you have to see every little dot, every little change, every little action.

This requires an insane focus, and you can't even take a smoke or toilet break. This is why they try to keep it just one or two hours a day, and if you want to do more, you need to take a long break after each one to gain your senses back and to be able to repeat it. I believe that most of the people are just trading for fun, or trading part-time, not as their job because most people cant do this as a job, it is not easy and causes a lot of trouble for a lot of people.

In the end, if we can do something that benefits us, then we need to consider that we are going to be considering the situation to be not easy for most people, it will cause a trouble and we are not ready for that if we are not professionals.

[Awaklara]

When you already know that having a few Shitcoins will only be a waste of time for those who expect a lot when holding Shitcoins, of course this can be quite a valuable lesson for them when they don't get anything when they have wasted more time to expect more things through Shitcoin. So now is the time to choose something more certain, such as Bitcoin and several other popular coins which are generally quite well known in the crypto market. So stay away from any Shitcoin and stay on the right track like on Bitcoin.

some people might ignore that. they spend a small fortune to get lucky with shitcoins. it's a gamble not a trade or investment that has a future. some people might not believe it until they have their own experience with shitcoins.
Asset diversification is definitely carried out by more traders. Even though there will still be those who are very focused and only believe in Bitcoin, they probably won't reject popular altcoins.

[beerlover]

Not only it would require a skill, it requires a dedicated focused time as well, which isn't that easy. This is why there are people out there who trade only for 1-2 hours a day, that's it. Main reason is that if you want to make any money from trading professionally, then you need to be locking your eyes on the screen, and looking at the charts very carefully, even a tiny miniscule information can't pass you without you noticing, you have to see every little dot, every little change, every little action.

This requires an insane focus, and you can't even take a smoke or toilet break. This is why they try to keep it just one or two hours a day, and if you want to do more, you need to take a long break after each one to gain your senses back and to be able to repeat it. I believe that most of the people are just trading for fun, or trading part-time, not as their job because most people cant do this as a job, it is not easy and causes a lot of trouble for a lot of people.

I agree, I have seen some people (on youtube/tv etc, not real life) who are professional traders and watched what they were doing, and they were quick too.

It is not just about how they have to have focus, but it is also about how quick they are, like they were basically soldiers in a war, with their gun, if they don't see it first, then they will be seen first, they were incredible agile whenever they saw something, they click everywhere with memory very easily in a second.

Like a trader who could look at 100 different pairs in a minute, and can execute a trade in 7 seconds is something dangerous, and that is why I stopped trading daily after a while, I realized that I could never beat those guys and they will always be better than me, because of how hard they work and how fast they work.

I believe that there is no need to be a trader like that, you could just be a trader who buys and sells in span of maybe ten days, like you don't have to act quickly, you do not have to do futures neither, just buy something, wait a week or two, and sell later. That type of trading is easier, because it allows you to make some money without having to deal with anything harder, and make money easier, less money, but easier.

[skarais]

~~~

When you already know that having a few Shitcoins will only be a waste of time for those who expect a lot when holding Shitcoins, of course this can be quite a valuable lesson for them when they don't get anything when they have wasted more time to expect more things through Shitcoin. So now is the time to choose something more certain, such as Bitcoin and several other popular coins which are generally quite well known in the crypto market. So stay away from any Shitcoin and stay on the right track like on Bitcoin.

I don't know which shitcoin you are referring to, but it is true that traders should avoid many altcoin on their list of coin that are worth their interest. I have no problem trading altcoin and making a profit, it's fine as long as you understand how it works. The market gives you the opportunity to make a profit from every coin/token that is traded freely on the exchange, so make a profit and accumulate bitcoin as a long-term investment.

[Viscore]

When you already know that having a few Shitcoins will only be a waste of time for those who expect a lot when holding Shitcoins, of course this can be quite a valuable lesson for them when they don't get anything when they have wasted more time to expect more things through Shitcoin. So now is the time to choose something more certain, such as Bitcoin and several other popular coins which are generally quite well known in the crypto market. So stay away from any Shitcoin and stay on the right track like on Bitcoin.

some people might ignore that. they spend a small fortune to get lucky with shitcoins. it's a gamble not a trade or investment that has a future. some people might not believe it until they have their own experience with shitcoins.
Asset diversification is definitely carried out by more traders. Even though there will still be those who are very focused and only believe in Bitcoin, they probably won't reject popular altcoins.

Shitcoins are now out of the picture, its golden days have been overdue. Trading with potential altcoins are more profitable as long as you know how to timing the market, but if you're still a beginner trader, I suggest you focus first on bitcoin and hold it for long term.

Trading, regardless of which coins you trade, is still not reliable that it will bring you profits at all times. Diversification is still the key. You could be trading with potential coins, while you are also investing in some potential investments that are highly capable to bring you exceptional profits in time.

[Hyphen(-)]

Since the retracement of Bitcoin, the market has become boring. Sometimes, the direction of Bitcoin is unclear. For example, the price action of Bitcoin is actually confusing. I have learned one thing in these recent days: As a crypto trader, do not rely on trading as your only source of income. It is good to have another source of income like real estate, staking, crypto jobs, mining,  and other legitimate sources of income. If I say that I will force trade now, it can end up in a loss.


What is your take on this?

If you are able to learn well and have knowledge about crypto trading, you defend on it because many people are depending on it to live as they have no alternative.
Although, it will be very good if you have physical business as backup, but it also involves risk which is a bit lesser than the crypto trading, but if you have the knowledge, make it your main source and you will earn from trading if you are not greedy.

[Bloodseekers]

If you are able to learn well and have knowledge about crypto trading, you defend on it because many people are depending on it to live as they have no alternative.
Although, it will be very good if you have physical business as backup, but it also involves risk which is a bit lesser than the crypto trading, but if you have the knowledge, make it your main source and you will earn from trading if you are not greedy.

Having knowledge is of course very important to be able to get a good income from trading, because it is impossible to get good results in trading without good knowledge about trading and if we choose to persist in trading because it is difficult to get income from other sources. Another thing, of course, is that we have to have good knowledge about trading so that we can continue to make profits from trading and when we can get profits, it would be better if we used these profits to try a physical business, which of course we can master this well so that we can run it. Of course, greed is very detrimental to us in trading, so it is important for us to be able to control our emotions when trading so as not to be greedy.

[Fivestar4everMVP]

Since the retracement of Bitcoin, the market has become boring. Sometimes, the direction of Bitcoin is unclear. For example, the price action of Bitcoin is actually confusing. I have learned one thing in these recent days: As a crypto trader, do not rely on trading as your only source of income. It is good to have another source of income like real estate, staking, crypto jobs, mining,  and other legitimate sources of income. If I say that I will force trade now, it can end up in a loss.


What is your take on this?

Well, it's a very good advice and something many of us have advised over the years to newbies who might be coming into crypto with the wrong mindset that they can easily make all the money that they want through this industry.
Diversification is very important, because just as you have explained or said, most of the time, the direction of bitcoin is always unclear, and this sometimes drives the market into a mode I personally refer to as unreadable mode, this is a mode where by the market becomes highly risky to trade on, that is, if you force yourself to trade in the market at that particular time or period, it's pretty easy to come out unprofitable, and making matters worst is the fact that Bitcoin still controls majorly all cryptocurrencies in the market, and what this means is that, when ever bitcoin becomes untradable, majority of crypto assets become untradable too, In times like this, shifting to other source is income is highly advised.

[crwth]

What is your take now OP? With regards to the recent uprise and potential of it even hitting a higher high?

I think having only trading as income would be hard to live by unless you have large capital that even a 0.5% gain would help you live already for a month. I think that would be the most ideal when you are trying to profit from it.

[Egii Nna]

Since the retracement of Bitcoin, the market has become boring. Sometimes, the direction of Bitcoin is unclear. For example, the price action of Bitcoin is actually confusing. I have learned one thing in these recent days: As a crypto trader, do not rely on trading as your only source of income. It is good to have another source of income like real estate, staking, crypto jobs, mining,  and other legitimate sources of income. If I say that I will force trade now, it can end up in a loss.


What is your take on this?

The best way to achieve more in crypto is not to depend on crypto alone; it should be like a source that will provide you with some profit that will help you create a passive income investment in order to get money and also support yourself when you have some financial issues with your crypto investment. The reason I said this is because many people tend to invest in crypto currencies and have no other source of income. If they fully depend on their crypto investments, they will end up using everything that they have already invested, and they will be the ones to end up losing. 
 
So as I said, from the first time, those profits that you will get in trading can be used to enhance some funds for you to create another investment that will also bring some money for you, which will not consume much of your time because if you can’t do some research, your trading investment might be affected. That is why it is always said that you should always have a passive income that will not affect your time.

[Lakai01]

The reason I said this is because many people tend to invest in crypto currencies and have no other source of income. If they fully depend on their crypto investments, they will end up using everything that they have already invested, and they will be the ones to end up losing. 

The biggest problem is that you can't sit out losses in a situation like this because you are dependent on the money.
You only need to look at the Bitcoin market. For example, if you invested 60k in BTC at the end of the last bull run, you now have a (very large) loss for 2 years. If you are dependent on the money during this time, you will have to sell the BTCs again at a significant loss.

However, if you invest money that you don't actually need, you can skip the 2 years and wait until the prices improve again ... and even if you start with 60k, you are currently making a positive exit.

Patience and time is everything ...

[dunfida]

The reason I said this is because many people tend to invest in crypto currencies and have no other source of income. If they fully depend on their crypto investments, they will end up using everything that they have already invested, and they will be the ones to end up losing. 

The biggest problem is that you can't sit out losses in a situation like this because you are dependent on the money.
You only need to look at the Bitcoin market. For example, if you invested 60k in BTC at the end of the last bull run, you now have a (very large) loss for 2 years. If you are dependent on the money during this time, you will have to sell the BTCs again at a significant loss.

However, if you invest money that you don't actually need, you can skip the 2 years and wait until the prices improve again ... and even if you start with 60k, you are currently making a positive exit.

Patience and time is everything ...

Thats the main difference into those people who have invested into the amount on which they can afford to lose and into those people who do make investment in crypto with their life savings. You would really be able to have that such difference on which we know that this isnt something that recommended because we do know that crypto investment is something which is really that unpredictable or something that you could really be able to know on where it would be heading. On the moment that you do see that your investment is really that negative for so long then you would really be that might be having that cutting loss on the moment that you cant take it anymore or your patience is really that out of your limit. This is why on the time or moment that you do invest on crypto then make it sure that you are investing on the amount on which you can afford to lose.

Never ever make yourself being that too confident about making profits with this unpredictable space because on the moment that you do find yourself on such condition then
cutting losses would really be that likely and this is something that what makes it even more worst.

[justdimin]

The biggest problem is that you can't sit out losses in a situation like this because you are dependent on the money.
You only need to look at the Bitcoin market. For example, if you invested 60k in BTC at the end of the last bull run, you now have a (very large) loss for 2 years. If you are dependent on the money during this time, you will have to sell the BTCs again at a significant loss.

However, if you invest money that you don't actually need, you can skip the 2 years and wait until the prices improve again ... and even if you start with 60k, you are currently making a positive exit.

Patience and time is everything ...

That is of course a possibility, but "money you do not need" is not something we can be sure about. Like for example last time I invested heavily, I did that with money I did not need, but then something changed in life and I needed that money and I had to cash it out, wasn't my ideal situation, wasn't what I wanted, but I had literally no other option at all.

In the end, it didn't help anything, and we just did it for a bit more ease of our mind, but I had to do it. So, not everyone can know if you will need that money or not, you may think that you won't, but life could throw you a curveball and suddenly you will need it. Being a crypto trader, one should never rely on trading profits because it is pure uncertain stream of income. So, OP is right here but for my case I am not a crypto trader and I am not living out of trading anyhow.

[Baki202]

Do you mean as a crypto investor, they should have multiple source of income and not just rely on their investment in bitcoin? As a crypto trader, you can always trade the market base on the result of your analysis of the market. You don’t have to wait for the market to be on uptrend or downtrend before you can execute a trade. If you’re an experienced trader, you need to just analyse the market to enter a buy or a sell base on the direction of the market. Only a novice trader will be bothered of this because they won’t really understand the market and might enter a trade wrongly. Multiple source of income is for those that depends on trading for their income and can also do without them when the circumstance does not favour them at that time.

Been a crypto investor if you have different sources of income it is good because you won’t worry to much about the price of bitcoin and you won’t be emotional, one of the things that makes people very emotional when they see their funds coming down as a result of impact of the market. So when their is other sources of income no one will panic because of the market. Their is always difference between those that are holding and those that are trading their is much difference, and even those are trading depending on the type of trading they are doing. You will still lose money and you will make profit the same time. And the analysis that you have to do before you start trading is what discourages a lot of people from trading and the second thing is they don’t want to lose their money. If it is the money you worked for their is no way you won’t get worried about your money, but with time you will get use to it.

[Lanatsa]

Do you mean as a crypto investor, they should have multiple source of income and not just rely on their investment in bitcoin? As a crypto trader, you can always trade the market base on the result of your analysis of the market. You don’t have to wait for the market to be on uptrend or downtrend before you can execute a trade. If you’re an experienced trader, you need to just analyse the market to enter a buy or a sell base on the direction of the market. Only a novice trader will be bothered of this because they won’t really understand the market and might enter a trade wrongly. Multiple source of income is for those that depends on trading for their income and can also do without them when the circumstance does not favour them at that time.

Been a crypto investor if you have different sources of income it is good because you won’t worry to much about the price of bitcoin and you won’t be emotional, one of the things that makes people very emotional when they see their funds coming down as a result of impact of the market. So when their is other sources of income no one will panic because of the market. Their is always difference between those that are holding and those that are trading their is much difference, and even those are trading depending on the type of trading they are doing. You will still lose money and you will make profit the same time. And the analysis that you have to do before you start trading is what discourages a lot of people from trading and the second thing is they don’t want to lose their money. If it is the money you worked for their is no way you won’t get worried about your money, but with time you will get use to it.

Doesnt matter whether you do get involved in crypto space or not, or simply being a trader or not on which you would really be wanting or needing to have that income diversification on which we do know that
when it comes to this aspect then it would really be always recommended that you should really be having that kind of other source of income to have a good financial condition or state.
It would really be that a common approach to have such aspect on where you would really be needing that multiple income source but the main challenge on here is on how you would really be able to do it?
On the moment that you would really be having such approach on which thinking about multiple income sources then you would be needing up that additional capital and of course that additional risks taking factor
on which on the time that you will really be dealing up with something new then risks management will really be the key or something that must have.

Who doesnt want on getting rich nor being that financially free? Of course we would really be that thriving as much as we can on achieving such state. So it will really be just that depending
on you on how you would gonna do it.