For those interested in cryptocurrency investing, DataDash presents a tutorial on how to build a cryptocurrency portfolio with only $500.
There are three points to remember before you start crypto trading. First, have a minimum of $500 in order to diversify your money appropriately. Second, always maintain patience and let your investments mature. Finally, know when to transfer your money.
In order to start investing in cryptocurrencies, you will want to secure your funds using a cryptocurrency wallet. A crypto wallet ensures that your funds aren’t hacked. Next, you have to find a cryptocurrency exchange service to exchange your fiat currency for cryptocurrency. DataDash suggests using Coinbase as exchange service but you can see other exchange options here.
Once you have transferred your money into an exchange, you will have to make a decision on whether you want to hold bitcoin or whether you’d like to trade altcoins. If you want to trade altcoins you will want to find a crypto trading service. DataDash suggests using Bittrex, but you can research other exchange and trading services here. Research the service fees and security that each exchange offers.
Once you have placed your cryptocurrency funds in a trading service, DataDash suggests placing 25% of your funds in large cap coins. Large cap coins include bitcoin, ethereum, and litecoin (the five cryptocurrencies that have the largest market cap). Next, place 50% of your investment in mid cap coins. Mid cap coins include Neo, Stratis, and Siacoin (the thirty cryptocurrencies that have the largest market cap). Finally, place 25% of your investment in small cap coins. Small cap coins include Digibyte, Ubiq, and Mysterium (the hundred cryptocurrencies that have the largest market cap).
DataDash gives three tips to all crypto traders. First, have at least two coins/tokens in each category in order to build a well diversified cryptocurrency portfolio. Second, research each coin or token before purchasing it. Do not buy an altcoin because of a bull run as this may turn out to be a pump-and-dump scheme. Third, don’t invest with emotions and set price levels to sell. Once your money has hit your predetermined price level, take 50% of the gains out of circulation and reinvest the other 50% back into the crypto market.