Cryptocurrency is not going anywhere. You might ignore or embrace it; it is up to you to decide.
It has been more than a decade since Cryptocurrency made the news headlines. Since then, it has never looked back. However, today in 2022, if we look back and see its journey, we will find that many have become millionaires, while many have lost all their life savings.
Talking about Cryptocurrencies always comes with mixed feelings. Some people have something good to talk about, while some warn to go near it.
We have our own opinion to give. We have been a closer follower of Cryptocurrency since its launch. We have seen how it has gone up and down in the market. So, one thing we can assure you is that if you have the knowledge of Cryptocurrency, it can be a perfect way to expand your portfolio.
The success of Cryptocurrency has come from how it has risen in price during the last decade. In addition, the popularity of Cryptocurrency has made people invest in them for retirement. If you are someone who believes the same and trusts a positive future for Cryptocurrencies, you can use the bitcoin loophole and expand your portfolio.
How Much Crypto Should Be In Your Portfolio
Cryptocurrency is the top digital asset today. While people might not be investing in it as their main assets, they are certainly using it to diversify their portfolio. As a beginner, you might get confused about how much to invest in Cryptocurrencies. If you are here for the same, let’s find out?
Some Say Cap It At 1%
Coming to how much you should have in your portfolio as a Crypto asset, different investors think about different numbers. For instance, because of volatility, some investors invest only 1% of their total investment portfolio.
While this might not be less depending on how much you have in your portfolio, new investors who are not aware of how Crypto trading works simply want to take things slow.
As they gain experience in trading Cryptocurrencies, they increase their Cryptocurrency portfolio gradually.
There are many experts who support the 1% theory and even encourage others to do the same. According to experts, the 1% mark is the sweet spot for investments as volatile as Cryptocurrencies.
Some Sat Cap It At 2-5%
As Cryptocurrencies are becoming more popular and financial advisors are gaining more confidence in knowing the market despite being speculative in nature, industry experts seem comfortable in advising 2-5% allocation.
According to financial expert Vrishin Subramaniam, Founder of Financial Planner, he advises their clients to have 5% of below Crypto assets if they are checking one every week.
This is because Cryptocurrency is a new market. Therefore, even small swings in price affect the graph and change the landscape of the market.
Once the Crypto holding increases that 5% mark, you will start to see the volatility swing affecting the traditional portfolio.
Skeptic Tells To Avoid It Completely
Although more and more financial advisors are growing comfortable with Cryptocurrencies, there are still groups still staying away from them. For instance, Warren Buffett has already shown his displeasure with investing in Cryptocurrencies.
Just like Warren Buffet, there are many financial experts that are not comfortable with investing in something that doesn’t have any physical existence.
While most financial investors are standing with Cryptocurrencies, when people like Warren Buffest feel uneasy about it, there must be something he has foreseen. It is something you must consider before evaluating the amount in your portfolio.
The Bottom Line
Cryptocurrency might offer the potential of having an explosive upside; the downside is that it is still an industry that runs on speculation. If you are correct with your speculation, you might just gain 1000% of your investment in Cryptocurrency.
You can see this kind of gain in Stocks. But with stock, you know which will eventually rise in the coming years.
There you have it. Now you know how many cryptocurrencies you should have in your portfolio. If you are confused about anything more, feel free to drop your queries in the comment section.