Quick profits or long term reaward? Trading psychology.
If I had bought
I hear it all the time, people saying ,,I would be rich If I had bought Bitcoin back then". No you won't! Why? Because you would sell it into first minor pump. Just imagine yourself investing 1000 USD back then in 2013 at lets say 10$ per BTC. Ask yourself how would you behave when the price went to 20$? People were saying it's a bubble, something purely virtual can't be worth so much etc. Would you hold to even 50$? You'd probably convince yourself that 500% profit is something unusual and no-brainier to cash out. After all you wait decades to get that investing in S&P500.
3 years ago only greatest minds were able to foresee and hold bitcoin no matter what.
But there is a way to do it even now. Maybe not in Bitcoin because it's hard to imagine Bitcoin going 20 times up but there are lot's of other projects. Development is constant and it won't stop. We are at the down of new era.
So my advice is to not treat cryptocurrency as short term investments. Of course there are people trading daily and it's good for the market because they provide liquidity. But all of them will go bankrupt one day if they don't stop it at some point. You can read biographies of greatest traders like Jesse Livermore who got bankrupt few times and at the end killed himself. Don't go that way. Swinging part of your portfolio, cashing out profits onto some shit altcoin pump to get more BTC is always good. Just play with insignificant part of your funds.
How to stop yourself from taking insignificant profits?
There are few ways I can recommend. One is just chill out and don't check the prices everyday. Make backups, secure all keys and check it every few months. It would be impossible if you invest money that you might need in short term for anything. Living, new car, holidays etc. It's hard to resist when you see that this altcoin gave you already few grands and if you cashout you can go to Hawaii. I would suggest cash out when it can buy you a house in Hawaii!
I would like to just leave here some words of Andreas Antonopolous, about trading:
https://streamable.com/fr6j8
I try to follow his wisdom when I trade.
Upvoted and followed.
thanks! :)
Can't agree with him more. If I just had listened myself haha.
so here you have another one: https://streamable.com/3omv2 :)
Me too
Good article @dawidrams. I agree - if you've invested with small money that you can afford to lose, no point cashing out till you can buy that house :)
And you don't need hundreds of thousands to invest for decent profits.
I double that!
I guess the same people who said "I should have bought back then" would be the same people who will say "I shouldn't have sold during the first pump" if they were given that exact opportunity.
It's how to get rid of mentality of the poor.
Excellent write up. I think this isn't growth isn't only monetary gain we're also writing history at this very moment!