How do you know what will be the best long term crypto investment? Will it be Bitcoin, Litecoin, or Ethereum? What about Ripple, Steemit, or Synereo?
There are so many cryptocurrencies out there, and it cannot be easy to know where you should put your money and how much time you should invest in the cryptocurrency market.
This step-by-step guide was created to inform you why wealth management firms may be the best long term crypto investment option available today.
Step 1 – Establish a long-term strategy
The best long term crypto investment strategy is to invest at least a third of your total portfolio in a cryptocurrency basket. This will be one of the major reasons wealth management firms should focus on bringing longevity to their clients’ crypto investments.
To minimize risk and volatility in your investments, diversification becomes key.
At first, diversifying between different types of crypto like coins (Ethereum, Bitcoin) and tokens (Filecoin) can help prevent swings that happen within just one type of crypto (Bitcoin) while being able to take advantage of growth opportunities in new cryptocurrencies and markets like Japan or emerging economies.
Step 2 – Research your options
The next step is to research your options and what you are looking for in a long-term investment. If you’re looking for a more secure investment with less chance of losses, the best option would be to invest in an Initial Coin Offering (ICO).
An ICO is a process of raising funds through crypto tokens representing company shares. The equity tokens can be used as voting rights and to receive dividends.
Step 3 – Execute your strategy
Putting your strategy into action is a very important part of the process. One way to do this is by rebalancing periodically, especially as market conditions change.
For example, let’s say you started with a portfolio that consisted of 25% Bitcoin and 75% Ethereum. But now, Bitcoin has increased in value, so it makes up 40% of your portfolio, and Ethereum has decreased in value, so it only makes up 60%. In this case, you may want to rebalance by selling some of your Bitcoin and buying more Ethereum (or selling some Ethereum and buying more Bitcoin).
If you have difficulty figuring out what allocations to make or how much to sell/buy, you can hire a financial advisor who will help guide you through the process.
Step 5 – Monitor your progress
It is also important to monitor your progress and check in every month. It may be difficult to remember the things you did last month. Remembering what you’ve done this month, even if it was a lot, will help make next month easier on your to-do list.
Lastly, document any successes or failures during this time to track what works and doesn’t for your specific business needs.
Conclusion
To take advantage of long-term cryptocurrency investment, you need an investment portfolio managed by an expert with the knowledge and skills to work with these alternative assets.
Working with a wealth management firm will give you a valuable point of contact who can help manage your entire investment portfolio. If you’re interested in maximizing your long-term cryptocurrency investments, then a wealth management firm may be able to bring longevity to your holdings.