What’s Your Preference?
When it comes to Crypto, most market participants consider themselves HODLers. They accumulate coins over an extended period, often making use of a dollar-cost averaging strategy. Then some look to trade the volatility of this particular market. They buy the dips and look to exit during a solid pump to the upside. There are of course many other strategies that can be applied in this market. However, these two are key.
Regardless of whether you enjoy the “safety” of a strategy or the adrenaline of a trading-based strategy. Choosing to utilize leverage can make a trading approach even more “thrilling”. I have always promoted diversification, whether it’s in the form of exposure, wallets, or exchanges. This also applies to how one chooses to approach the market. A single strategy can be somewhat limiting in numerous ways.
For instance, certain market conditions are better suited to a particular strategy. In other words, different strategies perform at different times, which is beneficial to the diversified investor. Diversified, regarding investment strategies, and not merely in terms of investment exposure. I have addressed numerous trading strategies in my writings, and one in particular is a combination of HODLing and trading.
Removing the Passivity Of HODLing
Instead of simply sitting on my long-term positions, I choose to allocate a percentage for trading. Recently, I began trading with approximately 20% of my primary holdings. As I mentioned in recent articles, I am beginning to cut down on my diversification, and am slowly moving into one particular altcoin. My goal is to hold 0.005% of the circulating supply eventually. One of the ways in which I intend to reach this goal is via this particular trading strategy.
I have been rather preoccupied with this goal, as well as calculated capital rotation. I managed to increase the coins I set aside for this particular strategy by 20% in a matter of 10 days. As you can imagine, if this return rate is maintained over a long-term basis, the multiplication will be quite significant. When it comes to accumulation, it becomes a lot more expensive as the bull market matures.
At some point, one has to begin honing in on approaches such as the abovementioned strategy, to maintain steady accumulation. If as an investor, your exposure is acquired purely by your purchasing power, you will eventually be marginalized by the market. Your monthly accumulation will begin to shrink, regarding the amount of coins you will be able to acquire. This particular strategy works incredibly well.
The fact that I choose to work with a minority position, regarding my overall holdings, also provides a level of safety. The majority of my coins remain in cold storage, while I increase my overall holdings by putting a portion to work. As I have mentioned, this strategy focuses on the increase of coins and not dollar valuations. It is also relatively safe, as it incorporates a strict and calculated capital deployment mechanism.
Final Thoughts
This is a strategy that I began using quite extensively with last year. Provided, discipline remains at the core of every trade, it works phenomenally well. Over time, coin holdings can be multiplied many times over. Of course, passive income is another great way to continue accumulation without any additional cost. Within the coming months, these types of strategies will become increasingly attractive.
Needless to say, it’s a great feeling to see your holdings increasing without any additional investment . These are the strategies that get me excited… and so, a lot of my time of late is being given to strategic capital rotation with the intention of multiplication. Take advantage of the dips, keep stacking… and I will see you next time!
Disclaimer
First of all, I am not a financial advisor. All information provided on this website is strictly my own opinion and not financial advice. I do make use of affiliate links. Purchasing or interacting with any third-party company could result in me receiving a commission. In some instances, utilizing an affiliate link can also result in a bonus or discount.
This article was first published on Sapphire Crypto
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