Today’s discussion on A Little Late In Crypto is all about Portfolio Management. The DPAD panel had two guests joining this evening from Mad’s Crypto Corner, a crypto information group based in Indonesia, one of the leading nations in crypto adoption. Everyone will take some time to weigh in on the following questions surrounding portfolio management for crypto assets.
Video Link- https://youtu.be/2eJIw7v1F8A
Portfolio Management Questions
- What is portfolio management ?
- Why is portfolio management so important ?
- How to improve different aspects of portfolio management ( risk management, diversification etc.)
- In the crypto world what are different ways to effectively manage portfolios?
What is Portfolio Management
Trading Star opened up the discussion by explaining that portfolio management really depends on the size of the portfolio, and if it’s strictly crypto there are different sentiments for each type of investor whether newbie or experienced. A newbie in 2014 is not one anymore, whereas a newbie from 2017 is likely not one, but still could be. Users will benefit from understanding BTC, and ETH and how to balance a portfolio as well as understanding the different seasons like BTC, large cap, small cap, micro cap etc.
For example BTC goes first, in what has been coined “BTC Season” where BTC will moon, while the alts have a hard time as money flows into BTC. Then ETH comes hot on Bitcoins heels, and then those two level out and begin moving sideways, possibly after a drawdown and the alt seasons begin.
Crypto Waley reeled us in from the moon by reminding us about some of the hazards in managing a crypto portfolio.
“If someone doesn’t know how to manage risk, futures should be avoided, flash crashes can make you rekt”
Some areas of crypto need more experience than others. Experienced traders that want to play with futures trading should do so at their own risk, and high risk trading strategies should be reserved for no more than 1% of the portfolio.
For a beginner who has under $500, spot trading is the best way to learn. Centralized exchanges are more user friendly but not always accessible like decentralized exchanges are.
Credible Crypto gave us a beautiful summary and definition of what portfolio management is.
“Portfolio management is the art and science of selecting and overseeing your investments to meet your financial objectives that match your personal risk tolerance with a different approach to short, medium and long term portfolios. One must also consider whether their portfolio should be actively or passively managed, as studies have shown that in crypto chances are passive investors will outperform active traders almost every time.”
How to improve different aspects of portfolio management?
The first things the DPAD panel wants you to know are how to manage your risks! You do that by tracking your portfolio, whether it’s a single coin you got in an airdrop, or a list of investments you need to monitor in accordance with your goals and investment strategy. To get started here is a list of of the best tips from the speakers
- Register on CoinMarketCap , Coin Gecko, or TradingView.
- Add coins to your portfolio
- Set alerts for price drops to DCA down
- Spend some time learning basic trading analysis so you understand basic support and resistance
- When there is resistance sell some of it (take profit)
When asked how to diversify a portfolio for a 25 year old versus a 55 year old the panel didn’t miss a beat. They immediately asked deeper questions to find out what kind of investor this is. Where is the money coming from? Is it coming from inside the market or outside the market? How much risk can you tolerate? Is this money that can be lost without being missed? So again, like always, personal finance decisions are personal, and there is no one size fits all, the more you define the parameters the easier it is to create a plan and strategy that suits you, to manage your portfolio.
In the crypto world what are different ways to effectively manage portfolios?
This section actually became an entire episode the following night, where the panel took a deeper dive into all the different ways to manage a portfolio. They went over the tools needed to begin, and gave tips and tricks on how to start, and how to improve if you have already started.
What is clear across the board is that everyone should manage their portfolio in the way that aligns with their investment and or trading goals. Even if that means buying and holding and never doing anything, passive management is still a defined style. Know what suits you best!
DPAD is dedicated to educating everyone to become investors and being able to BYOB not bring your own booze, but Be Your Own Bank!
To take back control of your financial future, learn how to use the tools the centralized finance industry has been hiding from you for centuries. Unlock control over your assets in DeFi, and DPAD will show you how! Join our community, our private sale is on now and we are looking for investors just like YOU to join us now.
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