Setting Up Your Crypto Portfolio Checklist
Everything You Need to Prepare for Before Investing in Cryptocurrency
Just getting started in cryptocurrency and don’t know what to do? Already in crypto but need a little help rounding out your thesis? No worries, I’m here to help!
Here’s a checklist of things you need to prepare ahead of time before investing your first dollar in cryptocurrency:
(PS Not financial advice, always do your own research - this is just a checklist of what I personally use for myself when investing in cryptocurrency since 2017.)
ALWAYS ASK YOURSELF “WHY, WHY, WHY?” And this often times will lead or answer your when, where, how”.
Example: Why am I investing this much? Why am I investing in this coin/project? Why am I entering the market now? Why am I taking advice from random strangers on social media? Why or why not are they correct or incorrect? Why do I think I can be profitable in this investment?
Which leads to: When do I enter an investment or trade? When do I exit my investment or trade? When do I exit when it doesn’t follow my thesis? When is this coin or project at it’s peak before it corrects?
Where do I invest or purchase this coin? Where do I store it safely? Where can I trade it? Where can I use it? Where is the community? Where can I find answers?
DETERMINE YOUR RISK TOLERANCE
How much of your investment can you afford to lose before you call it quits?
*If you can’t afford to lose any more, DO NOT INVEST IN CRYPTO OR NFT’S!! Bottom line…
DEFINE YOUR REALISTIC INVESTMENT GOALS
How much ROI do you hope to gain?
How will you acquire this ROI?
In what amount of time do you expect to make this ROI?
What is the past history of others achieving this ROI in the same amount of time?
Did they have more time in the space than you?
Did they enter their positions at earlier times?
Did they have more/less/equal information you have?
Was it a small amount of $$ or large amount of $$?
What was the world economy like at this time?
What was the sentiment of all these projects at this same time?
*Nobody will have identical matching results so don’t expect to get the exact same ROI as anybody else but have a strategy or strategies to help you try to time the market better and with much higher accuracy while avoiding any major losses while you attempt to compound your holdings.
FORM AN ENTRY AND EXIT STRATEGY
When will you enter a coin
How long do you plan to be in this position
When you do you plan to exit this position?
Do you have any failsafe mechanisms in place if your thesis becomes outdated and the market turns in an opposite position within the time frame you’ve given your holdings?
How can you exit your position with little loss and cash out to a spendable currency and how long will it take? How many fees on the way?
ENSURE YOUR EMOTIONS ARE IN CHECK - If you trade emotional rather than technical expect to lose everything. More information you have the better chance you have at becoming successful in compounding your ROI.
DECIDE HOW OR WHERE YOU WILL GET YOUR VALID TIME-SENSITIVE INFORMATION FROM TO BASE YOUR INVESTMENT DECISIONS ON
Are you asking random people on social media?
Are you asking experienced investors?
Do they have a track record?
Can the provide data that they have been successfully correct over a long period of time?
Are you following mainstream news sources or news coming directly from the projects, developers and technical thinkers?
GET A VPN - This will protect your IP address and make it harder for hackers to track you and your accounts.
SET UP YOUR CRYPTO WALLET(S)
Which wallet(s) are you choosing and why?
Do they have the highest level of security?
Do they charge fees?
Have there been hacks, issues with the wallet or technical limitations?
FORM A THESIS - DETERMINE WHICH COINS/NFT’S/PROJECTS YOU WILL BE INVESTING IN OR TRADING - Make sure you know EVERYTHING you need to know to ensure your are comfortable holding this investment position short, medium or long term and know how to enter or exit the position.
Does the project have liquidity?
If the market turns south, will this project survive a bear winter?
If the market is down drastically for some time, what’s your plans to hold, grow your position or exit?
How active is their social media?
Whose the team behind it?
IF YOU ARE PLANNING ON TRADING - The more information you have the better.
Are you scalp trading? Swing Trading? Hodling? Staking? Loaning? All five?
Do you know strategies that work under various market situations?
Do you know what to do if something doesn’t go your way?
WHICH EXCHANGE(S) WILL YOU USE TO ACQUIRE YOUR INVESTMENT TOKENS, CRYPTOCURRENCIES OR NFT’S?
Is the exchange proven to be safe?
What’s the exchanges fees?
Is it KYC required?
Is the exchange available in your location?
Does the exchange have all the proper and legal paperwork and documents transparent?
How is their security?
What is the withdrawal time for your cryptocurrency?
Is there enough trading volume on this exchange for the coin(s) or projects you hope to invest in?
HOW MANY STEPS AND HOW MUCH % DO YOU HAVE TO PAY TO EXIT YOUR POSITION AND ACQUIRE SPENDABLE CURRENCY?
And how long will it take before the money is in your spendable debit card or bank account?
I think once you can answer all these questions you should be good to get started, however it’s a VERY deep rabbit hole so stick to the simple things until you can get a guide, work with a mentor or practice a LOT to where you have a bit more control over your results.
Always be super careful with your investments. If you wouldn’t trust some random person on the street telling you to invest in a specific project, you probably shouldn’t trust some random person on the internet telling you to do the same. Do your homework, form a thesis, stick with it.
I know there’s a lot that goes into cooking the perfect recipe, if you need help feel free to contact @CryptoKyle
