When we are interested in investment in the crypto, a number of questions arise vis-à-vis our way of managing our capital. Between the bombing of information, emotions, market variations like this week, it can sometimes be difficult to see its cryptocurrency wallet far from the objectives that we have set. A solution to set up: the investment process.
Why define an investment process in the crypto?
As human beings, we are victims of our emotions, influence – aware or not – of the world and the information around us. This is why establishing processes allows you to fight against your number 1 enemies, yourself.
Defining an investment process is crucial for several reasons. It allows better risk management by establishing clear limits and aligning investments in its own risk tolerance. It also promotes financial discipline, allowing a constant and regular approach rather than making impulsive decisions.
But above all, it will greatly optimize performance using precise strategies, such as the DCA, to name a few, in order to smooth the purchase costs.
👉 Find out how to buy cryptocurrencies simply
Defining an investment process provides a clear framework for the actions to be taken throughout the Crypto investor's journey. Well defined, it offers the flexibility necessary to adapt to the changes in the cryptocurrency market while allowing strategic adjustments according to changes in conditions or personal objectives.
To help you build your strategy, here are some examples and a concrete case that will make you a better investor.
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When to get the purchase of cryptocurrencies?
Let's start at the beginning. Buying cryptocurrencies can be done with different types of DCA, via the triggering of a signal on a technical indicator, on temporal recurrence, etc. There are x ways, as there are x individuals.
You must take the time to find yours, to transform it into a clear plan, then, the most difficult part, To stick to it! You have surely heard this sentence a thousand times, but applying it will greatly change your results and above all, will free you from brain time for other subjects.
If they are not automatic, your processes should be as binary as possible.
👉 I have a data to who reaches me:
Does this data are back in the field of my strategy?
- Yes, so I do the action;
- No, so I sit on my hands.
Remember, doing nothing is also a decision-making.
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When to sell your cryptos?
It is surely the hardest step to make, because it is the one for which our brain plays us the most laps. You must, in the same way as for the purchase of cryptocurrencies, set up a clear strategy that will allow you to perform in the long term.
For example :
