How to Build the perfect Cryptocurrency Portfolio?
When investing or trading, one of the fundamental rules is to have a risk management strategy to limit possible losses and their risks.
Building a solid Cryptocurrency Portfolio is part of those rules.
In this article, we will go through cryptocurrency portfolio trackers, how to build & manage them, and the best applications to keep a track record of them.
What is a Cryptocurrency Portfolio?
When trading or investing in cryptocurrencies, if you want to reduce the risks of losses, you want to diversify your portfolio.
Having all your funds invested in 1 asset will increase the risk of losing a significant part of your wealth.
Indeed, nobody is safe from any fud (Fear, Uncertainty, Doubt), hack, crash, or whatever can cause a coin to see its price drop -50% in a week.
To prevent this disaster from happening to your capital, you must diversify your investments. While you will be diversifying your global investments into real estate, stocks, bonds, commodities, or anything else, there must be a minimum of diversification in your cryptocurrency portfolio as well.
Cryptocurrency Portfolio Management
You must develop a way to evaluate potential investments to get a solid cryptocurrency portfolio. Different options exist:
While building your cryptocurrency portfolio, you must ensure to possess “strong” and reliable assets. Those must be resilient to any sharp move or price crash.
Core Assets should be Bitcoin (BTC), Ethereum (ETH), and Tether (USDT) or any other stablecoins.
In case of a BTC Bullrun, or crash, you will be happy to be holding BTC and USDT and not having 100% of your cryptocurrency portfolio in volatile altcoins.
A model Cryptocurrency Portfolio may look something like this:
- Bitcoin: 25%
- Tether: 25%
- Ethereum: 15%
- Trading mid-term: 10%
- Fundamental Analysis long-term: 10%
- Trading short-term: 5%
Be careful. The model portfolio described here may not be relevant in the future. The market is dynamic, and such information can be outdated quickly.
The best Crypto Portfolio Apps
TabTrader is an ideal tool for people willing to build a cryptocurrency portfolio. It facilitates the connection with multiple cryptocurrency exchanges from one place. Moreover, you can stock performance, price, and data analysis. The application is user-friendly on mobile. It is easy to manage your crypto assets on the go. With TabTrader, you can analyze prices, data, and even trade your cryptocurrencies.
Blockfolio is one of the most reputable applications among all the cryptocurrency portfolio tracking app. With over 10 million downloads, it keeps being the most downloaded cryptocurrency portfolio management application.
Which Cryptocurrency Portfolio Tracker is the Best?
- Affordability: All the cryptocurrency portfolio trackers are offering free versions. They all are primarily sufficient for any classical investor.
- Range of coins & exchanges: If a cryptocurrency portfolio tracker does not offer a connection to a specific coin or exchange, you have no reason to use it.
- Safety & Security: More than having to offer security measures like two-factor authentication and multi-layer encryption, you must ensure that you agree with the functionalities and access that your cryptocurrency portfolio tracker has on your exchanges accounts. With the API, you can edit the permissions only to let the tracker watch your assets, and not trade or transfer them.
- Clear layout: You should be at ease with your cryptocurrency portfolio tracker not to waste time or being uncomfortable while analyzing your performances.