From Bitcoin to Ether, these digital coins have certainly taken the world of investment by storm – leaving just as many people enthusiastic about trading as those who are sceptical. For those who are neutral on the subject, yet curious about the potential these assets may hold, there’s often the question of how much you should buy and if it’ll be a good decision in the long run.
Are you one of the many new investors out there asking “How much crypto should I own?”? If so, we’re here to give you a helping hand in determining a worthwhile amount of cash for your trading endeavours.
Do you need to get into cryptocurrency?
Many people have opposing opinions on these digital coins, but it’s important to consider the potential that it holds for you if you’re tempted to purchase a few.
Despite the fact that cryptocurrency has been around for about a decade now, there are still many people who are just as uncertain of it as they were when it first started to gain traction. Now that Bitcoin is worth more than $40,000, it’s hard to deny that there’s potential in these digital coins. The only issue is that crypto is quite unlike most other types of assets, which means that trading is often far different from what investors may be accustomed to.
How much should you invest in cryptocurrency?
If you’re looking for the optimum amount of money to invest, you’ll be glad to hear that quite a bit of research has been done on the subject.
In general, investors will find that investing around 3% of their net worth into cryptocurrency can be worthwhile. According to a study conducted by Yale in 2019, an average of 5% is a good amount to allocate to cryptocurrency in your trading portfolio, which may be worth considering if you’re hoping to add it to your repertoire.
Crypto may be unpredictable, but looking at its history, the volatile nature associated with this form of currency is part of the reason why it holds so much potential.
Is it worth diversifying your trading portfolio?
If you do decide to invest, we’d advise you to consider looking into a range of cryptocurrencies and purchasing a few coins from each. The idea of investing in one popular name may be appealing, but it’s important to remember that diversifying your portfolio is generally a safer way to make worthwhile returns.
Generally speaking, this could be an important factor to keep in mind if you’re interested in profiting from these kinds of digital assets, but are worried about the volatility.