Post
Topic
Board Trading Discussion
Re: is this a good divide? thanks
by
CryptopreneurBrainboss
on 07/08/2021, 02:31:33 UTC
It's good to diversify our portfolio, so it won't seem like we are placing all our eggs in one basket, from the coins you listed above I know bitcoin and Ethereum and cardano, but I don't really know the ravecoin and I would suggest you replace it with a coin that is even more promising

It isn't really diversification if the assets are correlated like in the case of investing in multiple altcoins when they all have same similarities in regards to price increase. Or investing in altcoin and Bitcoin when you know that Bitcoin controls the cryptocurency market meaning that only when Bitcoin is having a good time will the market be positive and if it's having a bad time, the market becomes negative.

Diversification should be done in different market so one asset can stand in for the others if things aren't really going great in that particular industry. For example diversifying between the sock and crypto market there by buying a stock of any company and then owning Bitcoin. You can also diversify into real estate or any other market order than that of cryptocurency.

This way you won't be affected if the cryptocurency market is crashing as you'll have other investment in good shape but if you were to buy hundreds of cryptocurency in the name of diversifying then it'll make no sense as the market moved in the same direction. A crashed in the market will mean all your investment in in bad shape, which isn't smart investment strategy.