Welcome back to The Bluffer's Guide to Cryptocurrency - a layman's approach to understanding Bitcoin and Blockchain Technology!
The previous blog went through a few common phrases that are often seen languishing in the various cryptocurrency forums. You can find that "Bluffer's List" by clicking here.
Now that you are relatively well equipped to understand the lingo used by folks in the forums and have bought some cryptocurrency, let's investigate a couple of ways that you can keep track of your purchases! Cue disclaimer.
Before I begin, I want to emphasise that this is a highly simplified version of what I have learnt from my own research and I'm sharing my learning with you. If you do know this topic inside out, be nice to those who are still learning about this (myself included) and we can grow together.
Furthermore, this is not financial advice and I am not a financial advisor. I am a crypto-enthusiast and wanted to create a guide to help total beginners understand what this is all about. Please seek financial advice from a qualified professional if you have any doubt about how to spend your money.
So with that said, brace yourselves, you might learn something! Shall we begin?
The Importance of Portfolio Management
Before I go in to what you can use, a quick word on why this is important. Sure, you may look at your current holdings and think, "OK I have x amount of this coin and y amount of this coin. What's hard to remember about that?".
What if you bought another 3, 5, 10 different coins because you like the sound and direction of these new and different projects? What price did you buy the coins at? Are you up or down on what you have spent? Is now a good time to withdraw? As you can see, when you start asking these questions, things get a little more difficult to remember then.
So, that's why we need to manage our portfolio using a spreadsheet or an app so we can see where we stand on our current position and how healthy that position is. There are two main methods I have used, one of which I use far more than the other - Blockfolio.
Blockfolio - Cryptocurrency Portfolio App
Great name, great app. I've used this for a quite a few months now and it's gone from strength to strength but there are other apps out there that may be suited to your style. By the way, the images I've used are not my own, they are from the Blockfolio Google Play store - if only I had anywhere near that amount... to dream...
Anyway, what I like about this app is that the interface is straight forward to use and it has pretty much every coin in its database with real time updates on their prices. Every time you open the app, it refreshes automatically.
Once you have added your coin, you then tap on it, go to "holdings" and then tap the "+" button to add the transaction. Make sure you have your order history open on whatever exchange you used to buy the currency so you can type in what price you bought it at. Of course, if you're earning or mining, just type in 0. Then type in the amount, save it and that's it!
Other useful things in there are graphs or charts that you can look at to see how the coin has performed over the last specified time period (from 1 hour to 1 year). You can even add coins on there that you haven't bought yet so you can "watch" them if you wanted to do some analysis to figure out a good "buy-in" point.
Furthermore, it has a "News" section which links to some of the main resources out there, allowing you to keep on top of events that are happening throughout the crypto world.
The final thing I like about the app is that developers of various projects give you updates through Blockfolio's feature called "Signal" so you can keep on top of their developments. This saves you having to put all that effort in to tap your way through to the main website :P
Where Can I Get The App?
It's available on both Apple & Android devices through their respective app store. Just type in Blockfolio and you will find it.
Aha, good old fashioned spreadsheets, the software that needs no introduction.
Seriously, if you have even a basic level of understanding in Excel or other similar software, you can use this to keep track of your portfolio. It's a lot more manual than an app and I have stopped using mine really since I got myself on Blockfolio.
However, those of you with a bit more knowledge of spreadsheets can create your own graph and see how your holdings have fluctuated day by day by inputting data but really, that's only "easier to do" if you have 1, 2 or tops 3 coins. Otherwise you will just be updating spreadsheets all the time and it isn't very exciting for most.
Having said that, I do find a spreadsheet is always handy for keeping on top of income and outgoings. With a bit of discipline (uh-oh the "d" word) you can see exactly how much you have coming in and going out, which allows you to make plans.
I know, typical response I get - "I'd rather not see how much I'm spending" - too bad. Having good financial practices using spreadsheets outside of and including crypto can never be understated but that's just my way of doing things and we all have our different methods. Horses for courses but anyway...
Ok, time for a time out!
Another quick blog here as we're whittling through the chapters now on our way to some real juicy stuff. Whatever you end up using as your portfolio manager, as long as you keep on top of your finances rather than the other way round, that's the important take home from today.
If you are enjoying the series so far, I'd love to hear from you! Thanks to those who have sent in some donations, it's much appreciated and certainly not expected! My Bitcoin wallet address is:
or if you prefer - use the QR code:
In the next section, we'll be going through some common phrases that pop up in the cryptosphere that will help you become fluent in the language!
Now though, it's your turn.
Did you enjoy the article or find it useful?
I'd love to hear from you and if you learnt something new, feel inspired to do some of your own research or felt I didn't cover something well enough, let me know and when I finalise the pdf, I'll make it right!
For now though, take it easy and catch you soon!
The history and technology of Bitcoin
2.1 How and why did Bitcoin come in to existence?
2.2 How does Bitcoin & blockchain actually work (Part 1)?
2.3 How does Bitcoin & Blockchain actually work (Part 2)?
Portfolio Management (you are here)
Cryptocurrency News Outlets & Fluctuations in Price
Blockchain Platforms for Musicians & Music Fans
7.1 Atom Collector Records