💰📈 The 70%/30% Cryptocurrency Investing Portfolio Approach (Updated V1.2) 📈💰

It has been a while since the last post about the 70% Core / 30% Play Money approach I use for my cryptocurrency portfolio. Time for an update!

In the last couple of months my approach really got tested and it was not easy to always stick to the plan, I have to admit. There were a few brief moments where I felt the need to make exceptions to the rules I defined for myself. That is the main reasons why I want to share with you a slightly refined version of the 70/30 approach below.

The purpose of sharing is to provide some inspiration and add value for those looking for ways to manage their collection of cryptocurrencies. This is not financial advice in any way, just some guy sharing his thoughts. Always do you own research.

The 70% Core / 30% Play Money Approach V1.2

A little recap. The idea behind this portfolio approach is simple: a 70% ‘Core’ (long-term) segment and a 30% ‘Play Money’ (short-term) segment. Each segment has its own guidelines and rules.

The ‘Core’ segment

Having this set of coins/tokens enables me to reap the benefits from a growing cryptocurrencies market without losing sleep over too much volatility. This segment holds projects that are based on different blockchain protocols and are focused on different problems or opportunities to create diversification.

• Investment period: Long-term (3+ months).
• Total value rule: Must be at least 70% of the total value of the portfolio.
• Number of coins/tokens rule: Maximum of 7 different coins/tokens at any given point in time.
• Blockchain protocol concentration rule: Maximum of 2 tokens that are based on the same blockchain.
• Rebalancing rule: Redefine ideal relative positions of holdings at least once a month and redistribute accordingly.

Other Core segment rules:

• Know as much as you can about these coins/tokens (team, community, primary focus, tech, roadmap, most important competitors, funding, business model).
• Make sure to keep yourself educated about recent and near future developments of these projects.
• When redistributing, ignore small deviations from ideal distribution to avoid unnecessary transaction costs.

The ‘Play Money’ segment

Having this segment in my portfolio allows me to enjoy the excitement of finding coins/tokens that have the potential to outperform the Core segment at least in the short term. It allows for speculation but simultaneously prevents unlimited Fear-Of-Missing-Out (FOMO) buying behaviour.

• Investment period: Short-term (a few days up to 3 months).
• Total value rule: Can be maximum 30% of the total value of the portfolio.
• Number of coins/tokens rule: Maximum of 8 different coins/tokens at any given time.
• Blockchain protocol concentration rule: Maximum of 3 tokens that are based on the same blockchain.

Other Play Money segment rules:

• When adding a new coin or token to this segment, the investment should at least be €300. This is to make sure that the potential profit is worthwhile the time invested in research and to avoid relatively high transaction costs.
• When making an investment, set a date in the future at which you will evaluate whether to keep the crypto in your portfolio or sell it. When the decision is to hold, set a new date to evaluate again. The evaluation date should not be further than 3 months in the future.
• When wanting to step out of a coin or token, sell all the coins/tokens you have of that particular project. Use at least half of the money to strengthen the Core segment and use the rest for future Play Money segment investments.

That is all there is to it. If you want to know more about the specific coins or tokens I buy, follow me and you won't be able to miss it. I post regular updates, like this one that might be interesting for you to read :)

Please share your thoughts in the comments below!

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Disclaimer: I am not a financial advisor, trader or developer. I am just a crypto/blockchain enthusiast. Please do your own research, draw your own conclusions and do not invest any money that you cannot afford to lose.