Cryptocurrencies are a world of great opportunities, and with a little planning and perseverance, investors can achieve lucrative returns. But the most important question is: How can you achieve success with a small, fixed budget? The buy-and-hold strategy provides the answer, as it is an effective means of long-term investment, taking advantage of the huge growth potential of cryptocurrencies without getting caught up in the daily market fluctuations.
Example of investing $100 per month
Let's say you have a fixed investment budget of $100 per month. This plan can be implemented through the following steps:
1. Determine currencies:
$50: Invested monthly in major cryptocurrencies like Bitcoin (BTC) or Ethereum (ETH). These currencies are relatively more stable and have a long history in the market, making them an excellent choice for a portfolio.
$30: For promising cryptocurrencies with great potential, such as Chainlink, Polygon, or AI coins like Fetch.ai. These coins may be volatile but have high growth potential.
$20: Spread across 3 small coins or meme coins, such as Shiba Inu or Floki, where the risk is high but the opportunities for double returns are also great.
2. Periodic investment:
Buy coins monthly at a specific time, such as the first day of each month, regardless of the price of the coin. This method, known as the averaging investment strategy, will help you spread your investment costs and reduce the impact of daily market fluctuations.
3. Rebalancing the portfolio:
Every three to six months, evaluate the performance of each coin in the portfolio. If there are good profits, allocate 10% of it to support small coins with rising potential. This gives you the opportunity to benefit from the potential growth of those coins while maintaining stability.
4. Patience and follow-up:
Use a long-term investment plan of one to three years. If your portfolio value increases due to a bull market, you can sell a portion of the assets to make some profit, and then take advantage of opportunities when declines occur.
With a small monthly budget, you can achieve a lot using a buy and hold strategy, which relies on a long-term view and occasional rebalancing. Following this approach allows you to grow your investments without the risks of day trading.