To be honest investing is not something you just go into at first you have to have some certain principles you have to follow so that you won’t end up messing up the investment. There’s a big different between a trader from an investor. Traders usually focus on short term goals all they care about is how to make profits from the market waves .
While investors focus more on long term and in order for one to embark on such he or she have to make proper planning that will help them build their investment as time goes . The reason why some folks usually give up too early is because, they usually go into bitcoin investment with the wrong mindset thinking all they need is to hold bitcoin for a year or two and they are good enough to go, and the truth is that it doesn’t work that way you have to first build your bitcoin stash through accumulation.
If someone thinks that I have some money now, I will build a house with it, but it will take 2-1 years to do that, so I invest that money in crypto.
I would say this is a wrong step, if you do not have enough money, you do not need to invest in crypto.
We are not talking about crypto here... so fuck crypto. We are talking about bitcoin, yet to the extent that you are actually talking about bitcoin rather than shitcoins, then you would be correct that there is a necessity for at least a 4-10 year or more timeline, otherwise you are trading (gambling) rather than investing, and it might lead you in a bad place if you are expecting to have the money in 1-2 years rather than 4-10 years or longer into the future.
It is even problematic to use bitcoin as a shorter term investment such as 4-10 years based on something like the desire to buy a house in that time line.... and a good reason to have a shorter timeline such as 4-10 years would be based on age and/or health considerations.
Nonetheless people are still going to be looking for places to put their money because they are saving up for some kind of thing like a house, so it is difficult to stop people from doing what they are going to do.
You invest it in other sectors or keep it in the bank.
You need to plan long-term when holding crypto, especially Bitcoin.
At least you know the word bitcoin.
For this, the amount of money left after your spending money should be invested in Bitcoin on a weekly, monthly or annual basis.
And in this way, you should make up your mind that you can hold the stored Bitcoin in any condition until you reach the final goal.
Overall there could be ways to save for a house and save (invest) in bitcoin too. .. .and many of us likely realize that those who invested in housing rather than bitcoin in the past 4-10 years have done way worse by investing into housing rather than if they had invested in bitcoin and let their bitcoin grown to a decent enough size.
Let's say that some guys invested in housing in 2016, and perhaps they bought a house for $200k, and maybe in the last 9 years the house might have doubled or tripled in price.. so maybe now, if they got lucky with the house, then such house is worth $600k... so 3x more (absent various maintenance and taxes).
Buying bitcoin with the same $200k in 2016 could have potentially gotten bitcoin anywhere between $300 and $1,000, depending on when the coins were bought, so worse case scenario would have resulted in 200 bitcoin, and the best case scenario would have had resulted in 666 BTC. .. so the bitcoin would currently be worth somewhre between $20 million and $67 million, which is an appreciation of anywhere between 100x and 335x. It seems pretty obvious that bitcoin would have had been the way better place to put value.. and there should not be any questions in regards to what would have had been a better investment in the past 9-ish year.
Surely past results do not guarantee future results, yet at the same time, bitcoin's investment thesis is not getting weaker, even if the upward slope of bitcoin't price curve is likely a bit less steep now as compared with 2016.
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In case for the other investments asset, they will serve as a means for backing us up to have an alternative source of income, and if things does not really works out as expected with them as well, we revert back on our emergency fund and use for any urgent need arising, so having all these in place, we may not be able to consider touching our bitcoin investment as we continue to hold until the market gives the required signal for sell.
I think you are almost talking same thing as diversifying
if I am not mistaken and JJG and some others has address this issue that one should not thinking of diversifying until they have gotten to an overaccumulation stage because when you say other investment asset you are indirectly talking of other investment aside Bitcoin investment which can still sometimes distract one from there main investment ( Bitcoin investment).
I don't think it is even advisable to use other investment asset as a means of back up. Someone who is ready to invest in Bitcoin will always ensure to have a good discretionary, back and emergency funds the back and emergency funds are used for unforseen circumstances that may arise and so using other investment asset as a back up funds is not really a good strategy per say.
It can be difficult to make very many blanket statement in regards to when diversification starts to make sense. Generally speaking there is no need to diversify in the beginning of an investment, yet a person does not need to wait until he reaches overaccumulation status before he might start to think that some diversification might make sense for him.
For example, we might start to think about diversification when our bitcoin investment starts to reach a 9-12 months or more of our expenses. .and if our back up funds are also 6 months or more of our expenses, then it might start to make sense to diversify some of our back up funds so that they are working rather than stuck in cash.. .since we likely only need around 3 months of cash for our emergency fund and perhaps we have another 3 months that are various back up that are not really working, yet we still want to tap into our back up funds prior to taping into our emergency funds or tapping into our bitcoin investment, so we may decide to invest some of those back up funds into various non-bitcoin assets, so we would spend from our non-bitcoin investments prior to spending from our bitcoin if there might be times that we might need cash...and yeah the point at which diversification makes sense can be fuzzy.. and guys may well likely know that they want to have some investments, perhaps in properties, stocks, bonds, commodities and/or business that is not part of the emergency fund or back up funds.
Your statement is limit supporting what is wrong under the disguise of freedom. In Bitcoin investment, you don't do the wrong thing and say that everyone have the liberty to do as they please because you will just run into problems. The essence of threads like this is to teach people the right thing so they can do better and be happy in the future.
The right thing is to buy Bitcoin with only discretionary income so that they will not be under pressure to cash out all their Bitcoin at any time. If they sell all their Bitcoin, they will run out of Bitcoin thereby defeating long term hold which is the recommended way of going about Bitcoin. If you have no discretionary income, then it is time to find a job or look for way of improving your finances before thinking about investing in Bitcoin.
Not all Bitcoins should be sold up on the way up, because, yeah, clearly, more would be lost than achieved doing things like that: however, making mistakes, although they can be avoided, is the best way to learn and remember what was done wrongly.
And, sure, a stable job and income mean a stable investment process.
You don't necessarily need to sell anything from your holdings if you are still in your accumulation stage because by thinking that you can outsmart the market is unwise, because by selling some of your holdings for minimal gains, thinking to buy back when it dip you are practically selling off most of your future revenue for peanut today which will make no much difference on your finances now, and you may never buy at that dip you thought you might get, so it's a move that should be avoided by all means.
Take note that am not against selling or taking profit from your Bitcoin holdings, but let it never be done when you are still in your accumulation stage.
Selling part of one's holdings while still making accumulations will slow down the accumulation process and make one not to meet up at the time they targeted to reach their level of accumulation and nothing weakens an investment to when you are investing and still removing part of it, it kills the morale of an investor because it will just look like the more you are trying to go up that is how you are falling backwards. Image someone like me that counts the amount i put in my DCA every week, let's say for instance i have accumulated like $500 worth of bitcoins and my target is to reach $1000 in the next 3 months and i already have it in mind to fulfil my wish but along the line i now removed like $200 from the one i hodl which means before i will accumulate that $1000 will now take me 4 months instead of the 3 months i bargained for, so it doesn't make any sense at all.
Your example is reasonable Cryptoprincess101, yet it still seems like we should attempt to be more realistic with our examples and maybe try to use more realistic numbers over a longer period of time.
Maybe we could look at some DCA charts and figure that maybe a guy who had been earning $30k per year might have been building his bitcoin holdings at $100 per week for the past 4 years, and maybe he has a goal that he wants to get to a point that his bitcoin investment will be able to support a $50k per year income, so over the past 4 years, he invested $21k, and he accumulated close to 0.6 BTC.. so he is doing quite well, yet
currently based on its
200-WMA value of a bit less than $30k, 0.6BTC would only support around a $3k per year income, even though it has a spot price value of about $61k.
Accordingly, the guy figures that he will have to keep investing into bitcoin another 4 to 8 years or more in order to feel that he might be able to get to a point that he might be able to support a $50k per year income or more from his bitcoin...
So if this guy decides to withdraw $10k or even $20k (which would be around 0.2 BTC to 0.3 BTC from his bitcoin investment to buy a car or to make some other purchase, then it may take him 4 years or longer just to get back to the point where he is right now... so guys in these kinds of situations need to be careful about cashing out of portions of their BTC for reasons that might not even be close to good, even if they seem good and pleasurable to accomplish. .but such cashing out would really set back the bitcoin investment quite a bit and may well add many years, perhaps 4 years or more onto the BTC accumulation and he still might not ever get back to where he could have had been if he had stayed focused on ongoing, persistent, regular, consistent and perhaps even aggressive buying rather than fucking around with selling too much too soon or even expecting to potentially be able to buy BTC back cheaper, which he would not have the money if he already spent it on something that he may well did not need and/or something that he may well could have had figured out some other way to finance it, if he really did need it.
Your proclamation that high or low volatility has to do with BTC price direction is not correct, since high volatility would be the BTC price moving a lot over a given period of time, and low volatility would be the BTC price not moving very much over a given period of time, and whether volatility is high or low does not have to do with BTC's price direction.
i am not disputing the fact that my proclamation is not wrong but i am still curious to know if demand and supply has nothing to do with bitcoin price changes weather moving a lot over a period of time or just price movement within a short period of time.
I already gave my explanation, which was largely that the concept of supply and demand and its affect on price
Is different from the concept of volatility.
sure supply and demand affect price.
Volatility is a description of what price is doing, and sometimes volatility can affect price by creating more volatility based on expectations of what BTC prices are going to do..
I doubt it is helpful to go over these points again, and hopefully you are figuring out ways to perhaps describe these kinds of matters in better ways, to the extent that they matter in regards to any points that you might be trying to make.
I don't claim to always speak clearly, either, yet I was merely pointing out that some aspects of what you said was not correct, and I already provided some explanation for what I was saying, even though I did not resort to dictionary, or AI or even investment guide definitions, even though the definitions that you provided for volatility are largely what I had already said.