While browsing investopedia, I read about 2% rule where you will limit your loss to only 2% of your total capital.
Will this be applicable to crypto market? I always believe that you should wait for stock/crypto to gain atleast 20% to lock the profit but the 2% rule seems interesting.
Any insight? Anyone using this strategy?
It is a method I previously used for my foreign exchange investments, but I cannot say that I use too much in the cryptocurrency sector. As there is more volatility in the cryptocurrency sector compared to other investment instruments, the rate of 2% will be quite low, which may be true investments. However, as I have stated, I think that this ratio should be used more in this sector since this ratio is quite insufficient both in terms of profit margin and loss. This ratio should be determined by the investor completely and should not be too high due to the high risk of the sector.