Experience Notes — 2020.10.18
For someone who has just entered the crypto world, I think it’s best to observe, learn humbly, and respect the market. There’s no shortage of opportunities in crypto: if you manage to pick just one or two good coins, you could turn your fortunes around. For most people, one good opportunity is worth more than dozens of costly mistakes. So, here are a few things I’ve learned about being a beginner in crypto:
1. A young calf is not afraid of a tiger. When you’ve just entered the market, you lack the knowledge and judgment needed to navigate crypto, so you blindly buy into a rising market and sell when prices fall just because you’ve heard that trading coins can make money.
2. Always hoping to break even. When you lose money trading, you don’t look for the reasons or reflect on your mistakes, and you don’t cut your losses in time. You keep hoping prices will rebound, and tell yourself you’ll sell once they reach a certain level.
3. Investing recklessly. You hear some news and jump into an investment without verifying the facts, afraid you’ll miss out on a chance to make money.
4. Afraid to act. When an opportunity comes along, you’re afraid of losing and worry that a bad call will lead you to repeat past mistakes. Then, when the coin’s price rises, you regret not buying and chase the rally.
Don’t be so restless when trading crypto. Don’t spend all day feeling anxious like a gambler who can’t relax unless they have a bet on. Just follow the basic rules of crypto trading. Before investing, be sure to think through these points:
1. When looking into a new project, understand it thoroughly before investing. If you don’t understand it, don’t invest; if the concept is unclear, don’t place a bet.
2. Ask yourself why you want to invest in this coin, and come up with around three reasons.
3. Decide what you’ll do if the coin rises—take profit—and what you’ll do if it falls—cut your losses.
4. Use your investment time horizon to assess the type of coin you’re investing in: one to three days for speculative coins, one to three months or one to five weeks for value coins. This is very important.
The crypto market is different from the stock market and traditional investment markets: information changes in an instant. You can’t use traditional investing to define investment time horizons in crypto. As the saying goes, “One day in crypto is like one year in the real world.”
For someone who has just entered the crypto world, I think it’s best to observe, learn humbly, and respect the market. There’s no shortage of opportunities in crypto: if you manage to pick just one or two good coins, you could turn your fortunes around. For most people, one good opportunity is worth more than dozens of costly mistakes. So, here are a few things I’ve learned about being a beginner in crypto:
1. A young calf is not afraid of a tiger. When you’ve just entered the market, you lack the knowledge and judgment needed to navigate crypto, so you blindly buy into a rising market and sell when prices fall just because you’ve heard that trading coins can make money.
2. Always hoping to break even. When you lose money trading, you don’t look for the reasons or reflect on your mistakes, and you don’t cut your losses in time. You keep hoping prices will rebound, and tell yourself you’ll sell once they reach a certain level.
3. Investing recklessly. You hear some news and jump into an investment without verifying the facts, afraid you’ll miss out on a chance to make money.
4. Afraid to act. When an opportunity comes along, you’re afraid of losing and worry that a bad call will lead you to repeat past mistakes. Then, when the coin’s price rises, you regret not buying and chase the rally.
Don’t be so restless when trading crypto. Don’t spend all day feeling anxious like a gambler who can’t relax unless they have a bet on. Just follow the basic rules of crypto trading. Before investing, be sure to think through these points:
1. When looking into a new project, understand it thoroughly before investing. If you don’t understand it, don’t invest; if the concept is unclear, don’t place a bet.
2. Ask yourself why you want to invest in this coin, and come up with around three reasons.
3. Decide what you’ll do if the coin rises—take profit—and what you’ll do if it falls—cut your losses.
4. Use your investment time horizon to assess the type of coin you’re investing in: one to three days for speculative coins, one to three months or one to five weeks for value coins. This is very important.
The crypto market is different from the stock market and traditional investment markets: information changes in an instant. You can’t use traditional investing to define investment time horizons in crypto. As the saying goes, “One day in crypto is like one year in the real world.”