Crypto Academy Course 7: Money Management & Portfolio Management – by @stream4u

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Hi everyone, welcome to this week’s course 7. In this homework post, I will be solving this week’s task that involves writing about Money Management & Portfolio Management when it comes to cryptocurrency investment and trading and giving my own point of view. I have to say, this week 7 course by the Steemit crypto professor @stream4u was a very interesting and important topic as far as investing and trading in crypto is concerned – The importance of having good and sound knowledge especially when venturing into cryptocurrency investments can never be overemphasized, so in my opinion, this was a very important topic to introduce in the crypto academy.

Money Management

In the world of cryptocurrency investing and trading, there are different aspects and factors that must be considered in order to reduce risk and ensure maximum profit as possible. Money management is one of those factors that should be considered when it comes to trading and investing in any asset.

The term Money management in cryptocurrency simply means financial strategy in which a cryptocurrency investor or trader uses to determine how to invest or trade and how to allocate and invest money into any cryptocurrency. In other words, money management is the financial strategy that helps users who venture into cryptocurrency investing or trading to divide their investment funds into smaller parts as a smart way to make better investment decision and to make the best use of the money to invest in different assets

One of the key benefits of using money management strategy is that it dictates when an investor or trader is going to capitalize and the quantity to buy based on the different parts of the overall money. Also for traders, money management helps dictate when to stop for the day so as not to make bad decisions because of emotions and stick to set out rules when it comes to money management. Some benefits of money management; a good money management strategy helps traders reduce potential losses in the market, money management helps investors make the best investment decisions, money management helps traders be in a better position for maximum profit, money management helps traders or investors capitalize on investment opportunities and not to miss out.

Future Plan on your Money Management

Based on my plan, money management is very important when it comes to investing or trading of cryptocurrencies. My future plan on money management is to stick to rules and focus more on money management principles by dividing my capital into smaller parts… for instance, a $100 capital can be divided into 4 parts of $25 - $25 - $25 - $25 and each of the $25 can be used to invest on four different cryptocurrency assets so as to reduce risk and increase the chances of more gains as one of those assets could have a massive price increase. Also, by dividing the capital into different parts, it also allows me to be in a very good position to capitalize on any investment opportunity that comes by using one of the parts instead of investing everything on one single asset.

Portfolio Management

When it comes to cryptocurrency investing and trading, there are different aspects and factors that must be considered in order to reduce risk and ensure maximum profit as possible. Also, there are different strategies used by investors and traders to reduce risk and gain maximum profits.

Portfolio Management is also another financial or management strategy that investors use to make the most of their investment capital. Every investor wants to make the most profit from any investment, that is why portfolio management is important. Portfolio management simply means the management of various cryptocurrency assets that constitute the main portfolio. In other words, is when investors strategically diversify their investments into different cryptocurrency assets to form a portfolio in order to reduce risk and increase the chances of more profit. When it comes to portfolio management, the investor can divide the capital into smaller capitals and use that to invest and spread the capitals on different cryptocurrencies which form the portfolio.

Future Plan on your Portfolio Management

Based on my plan, Portfolio management is very important when it comes to investing in cryptocurrency. Having a good portfolio is very important as a good portfolio helps reduce the risk of losses and puts you in a better position to make good profits from your investments. My plan is to divide my bulk investment capital into smaller capital, let’s say an investment capital of $300 can be divided into 5 smaller parts of $50, $50, $50, $50, $50, $50. I will make a decision to invest the funds into 5 different cryptocurrencies that will be in the portfolio. My decision will be based on low risk, slightly risky and high risk. What this means is that I will invest 2 parts into high marketcap (low risk) cryptocurrencies, 2 parts into mid marketcap (slightly risky) cryptocurrencies, and 1 part on low marketcap (high risk) cryptocurrencies. These will form the portfolio.

Investment Failed

Based on my experience, I don’t really think of investment to fail when money management and portfolio management principles are followed. An investment is considered failed if the investor didn’t do proper research and didn’t follow the money management and portfolio management principles and the investment is lost due to investments on bad projects or scam projects. Investing in good cryptocurrencies and following money management and portfolio management strategies helps to reduce investment failure.

Conclusion

When it comes to cryptocurrency investing and trading, there are different aspects and factors that must be considered in order to reduce risk and ensure maximum profit as possible. Money management and portfolio are two very important factors and strategies that should be considered when it comes to investing in and trading cryptocurrencies. Following the strategies in money management and portfolio management helps to reduce risk by dictating how the investor will invest the capital into different cryptocurrencies and build a good portfolio.

Cc:
@steemcurator01
@steemcurator02