Investment and Risk Management

[Loyang]

Investment and Risk Management

First you have to be a conscious investor. For example, having an understanding of investment concepts and how to invest. If a person is not aware, then it will be very difficult for him to hold on to the holding.

Investment:

*First, a person should have a source of discretionary income.

*Belief in Bitcoin and basic knowledge about Bitcoin.

*Investing for a long term such as keeping a time frame of 8 to 10 years.

If a person is in this range, then that person can start investing and continue buying continuously depending on his discretionary income.

Risk Management:

*You have to be patient.

If you are not patient, then you can sell your investment before the expiry of the period.

*You need to create an emergency fund to protect your investment. Try to keep 3 times your regular income in the emergency fund.

If you don't have an emergency fund already, you can create an emergency fund along with your investments. For example, you can invest $20 and then invest $10 and keep $10 for your emergency fund. In this way, you can have your investment and emergency fund at the same time.

*Proper financial management is very important. Because if you cannot manage your earned money properly, you may not be able to invest consistently and your investment may face risk later.

If you spend more than your income, you may end up in debt later and then you may have to sell your holdings.

*Reduce excess expenses

If you can reduce your excess expenses, it will be very good for you. Such as excessive smoking expenses, excessive eating out. etc.

*Keep yourself calm during market ups and downs.

If you are scared of the market's ups and downs, you might want to sell your holdings at that time, but try to keep yourself calm.

*Do not sell your holdings until the investment period ends.

[BIT-BENDER]

*Keep yourself calm during market ups and downs.

If you are scared of the market's ups and downs, you might want to sell your holdings at that time, but try to keep yourself calm.

*Do not sell your holdings until the investment period ends.

Good post OP I enjoyed reading this post although I have some thing I think you may want to look into and reason it critically.

The two points you made that I highlighted can't be under Risk management.
The first point I valid because in risk management when ever you feel a threat or have a doubt then to manage your risk you may want to sell.

But the second point which if it's Bitcoin I will take it as the wise choice but when talking about risk management you should not care about your sentiment, you next move in risk management should be based on you managing your portfolio so I don't see how not selling until your investment period ends is a risk management.

[Dulen007]

This post really makes sense. It covers the basics well and gives practical advice that any beginner can understand. But here’s a little contribution I want to add:

One thing I noticed is that emotional discipline is just as important as financial planning. Many people know what to do, but the real challenge comes when the market crashes or when people around them start panicking. That’s when most sell out of fear, even after planning for long-term.

Also, maybe it’s worth mentioning that not everyone has to invest heavily at once. Even small, steady amounts (like N10k, N30 weekly) over time can build a strong position. Especially if you're using Naira Cost Averaging (NCA).

Lastly, I’d suggest one more tip for risk management:

Never invest money you’ll need soon.
If your rent or school fees is due next month, that money shouldn’t be in crypto.

[fredericktaylor]

*Keep yourself calm during market ups and downs.

If you are scared of the market's ups and downs, you might want to sell your holdings at that time, but try to keep yourself calm.

Op you said very well that if an investor follows these guidelines then he can get something good by investing in the long term. I would say there is nothing to fear in long term investment. You said if you are afraid of the ups and downs of the market then you can sell your holdings at that time but try to keep yourself calm. Long term investment will not have any impact on the market price which means if the market falls then there is no panic, it can be a big opportunity for investment success comes to those who can continue investing patiently. It would be wise to invest and hold on.

[Donk1]

base on say e no get investment way risk nor dey, person nor suppose to dey fear to invest as long as you get better risk management plan for ground, e go help person reach better financial goal. Dis Ur post go really help many newbies for crypto like me make better informed decision when dem dey invest, as e dey very easy to understand.

[Mehmet69]

Investment and Risk Management
First you have to be a conscious investor. For example, having an understanding of investment concepts and how to invest. If a person is not aware, then it will be very difficult for him to hold on to the holding.

Investment:

*First, a person should have a source of discretionary income.
*Belief in Bitcoin and basic knowledge about Bitcoin.
*Investing for a long term such as keeping a time frame of 8 to 10 years.
If a person is in this range, then that person can start investing and continue buying continuously depending on his discretionary income.

Risk Management:

*You have to be patient.
If you are not patient, then you can sell your investment before the expiry of the period.
*You need to create an emergency fund to protect your investment. Try to keep 3 times your regular income in the emergency fund.
If you don't have an emergency fund already, you can create an emergency fund along with your investments. For example, you can invest $20 and then invest $10 and keep $10 for your emergency fund. In this way, you can have your investment and emergency fund at the same time.
*Proper financial management is very important. Because if you cannot manage your earned money properly, you may not be able to invest consistently and your investment may face risk later.
If you spend more than your income, you may end up in debt later and then you may have to sell your holdings.

*Reduce excess expenses

If you can reduce your excess expenses, it will be very good for you. Such as excessive smoking expenses, excessive eating out. etc.
*Keep yourself calm during market ups and downs.
If you are scared of the market's ups and downs, you might want to sell your holdings at that time, but try to keep yourself calm.
*Do not sell your holdings until the investment period ends.

@op, you said it very well. You have tried to explain in simple terms what a new investor should pay attention to when starting to invest in the initial stage. You have presented it in very simple terms for beginners. There are many new members in the forum who want to collect Bitcoin in their portfolio. But they start investing without having any information about Bitcoin. They want to shoot in the dark. Since it is Bitcoin, many new investors often invest with that goal in mind. However, if they get a proper understanding of what Bitcoin is, what Blockchain is, how the market works, then they will continue investing with more confidence.

[cxtreenal]

Your future potential financial freedom depends on the connection between your money management and your investment. You should initially focus on stabilizing your income source. Investment decisions should be made when you have discretionary income at the end of the week/month.

Risk management in investing will apply to you at a time when you are trying to get used to short term trading or are trying to pressure yourself to get rich in a short time. Moreover risk management should not be necessary for long term investors.

As you said, basic knowledge about Bitcoin is required and there should be an emergency fund so that the funds can be used in emergencies without withdrawing the holding. The amount of the emergency fund should be determined based on your financial capacity. Generally you should keep a fund equivalent to covering 3-6 months of family expenses.

[rachael9385]

When it comes to being patient after making an investment there are lots of things that are to be considered but one major thing is having a source of income and also emergency funds just Incase you have unexpected things that comes up. Not everyone sells their tokens as a result of impatience, some sell Their tokens because they have no other source of income to solve their financial problems. Expense reduction is another important thing you mentioned, a lot of people spend money on things that they don't need, there's a difference between your needs and wants. When you are on the come up and still trying to be financially stable there are somethings that you need to cut out totally, these are actually the things that are not allowing you to utilize and manage your resources

[Proty]

The point the op has raised here are very crucial for successful bitcoin investment. I really do love the aspect of discretionary income, before anyone should be suitable to invest in bitcoin they must have discretionary income . Discretionary income is the most important thing that an investor must have before they can be able to invest in bitcoin. They don't necessarily need to have a stable source of income, they can be investing in bitcoin and at the same time while working on how to stabilise there source of income. Just like you said, emergency funds is very important for a successful bitcoin investment, because without emergency funds an investor will find it difficult to be able to hold bitcoin for a longer term. Whenever there is a real emergency, without emergency funds an investor will be forced to temper with his investment.