Ok so one of the biggest and most frequent comments I hear from people who are new to investing in general is that they are afraid of the risk to their hard earned money. In fact many of these people have told me that this fear of risk even causes them to feel a touch of anxiety over the entire ordeal.
Let me first say that I completely understand. Everything that we do in this life contains a risk factor. For example, if you got up this morning and drove a car to work, risk was involved the risk of getting into an accident causing you bodily harm. If you ate at a fast food place, risk was involved the risk of eating poorly prepared food that could potentially cause you bodily harm. However, let me also say this, there are numerous ways to reduce these risks down so that they are exceptionally small or even non-existent. That's what this post is about, how to reduce the risk factor in your crypto investing thus reducing risk, and I will use some real verifiable numbers as examples that can easily be duplicated.
Ok, so the risk of investing in cryptocurrency is the amount of money you put into your investment. Risk = Money invested. For example on August 3, 2020 around 7:41pm CST I invested in $4.01 worth of Orchid (OXT). They cost $0.1763 per OXT at that time. So the "RISK" I made on this purchase was in the amount of $4.01. Twelve days later the value of OXT had gone up quite a bit to $0.2583. I increased my investment another $18.51 bringing my total "RISK" to $22.52.
The very next day August 16, 2020 the value of OXT had gone up to $0.7034, So I decided to eliminate my "Risk". I sold a portion of my OXT and pulled out $35.
So now my "Risk" in this particular investment is $0 and I left $30 worth of the profits in OXT as this is all pure profit with ZERO RISK.
I also created a second "Risk Free" investment by placing the extra $12.48 that I pulled out of my gains and put it into a separate investment.
Now I am free to either reinvest my seed money and risk the $22.52 again or hold onto it and let my risk free investments grow, but either way I decide to move the point of this explanation is once again how to reduce or even eliminate the fear of risking your money in investments. Remember there is risk in everything you do, but the riskiest thing I can think of is to do nothing.
Start investing, grow your investments, reduce your risk, and continue building your way to financial freedom.
Thank you for reading