How Much Money do you Need to Start Trading Cryptocurrency?
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How much money do you need to start trading cryptocurrency?
How much money do you need to have to try your hand at trading cryptocurrencies? Where to begin? How not to lose start-up capital? The experts of the BitXmi team will give answers to these questions in this article for novice traders.
Trading is a rather risky way of earning money, which requires knowledge and skills. Сryptocurrency trading is even more dangerous as it is an extremely volatile asset. On the other hand, high fluctuations in the value of digital money allow not only to quickly lose capital but also to provide an opportunity to increase it.
You can start trading cryptocurrency from $100 – 200
It is better to start your acquaintance with cryptocurrency trading with the spot market, experts from the BitXmi team recommend. This will allow you to get acquainted with technical analysis, develop a trading strategy and trading discipline, without exposing the deposit to high risks.
When determining the starting amount, it is worth following the rule that its loss should not affect welfare in any way. The amount should allow you to participate in trades long enough to be able to master the trading tools and work out the strategy.
“$100-200 is enough for this. You should not strive to make money right away – this will negatively affect psychological stability. At the initial stage, the main task should be the formation of a trading discipline and a trading strategy, which in the future will be able to protect when operating with significant amounts using leverage.”
If the first trading experience is successful, then in the future you should analyze the average profitability that was obtained when working with a small deposit. Also, BitXmi experts recommend setting a goal in real terms, which you need to achieve in a year or a month. For example, if the profitability was 10% per month, then to earn $ 1000, the deposit must be $ 10,000.
In the ideal case, that is, with a uniform income of 10% from month to month, income in real terms will grow as the deposit increases. But there are no ideal cases, and you always need to strictly adhere to the rules of trading discipline, this is the main guarantor of successful trading in the long term.
$1000 will be enough to start trading
One of the main advantages of the crypto market is that you don’t need a lot of start-up capital to get started. A beginner trader will only need a thousand dollars to purchase some digital money, transfer it to the exchange, and start speculating using the chosen strategy.
“On the one hand, this amount is enough to buy a cryptocurrency, on the other, not so large as to be afraid of losing it. While there is no experience and practice, there may be a lack of knowledge and understanding of the market, and it is easy to be left without investment, ” – BitXmi experts say.
The more funds on the account, the more comfortable and safe it is to trade
The most comfortable amount for cryptocurrency trading should be such that trading takes place with minimal risks, that is, without using leverage. For example, $ 13.4 thousand is enough to trade BTC “1 to 1”, or about $ 400 at the current rate to buy ETH.
The fewer funds are, the more borrowing is needed to buy or sell cryptocurrencies. Margin trading can be profitable and effective if the trader has experience and knowledge in financial analysis. But a novice trader needs to learn to control risks and avoid losses to eventually reach an acceptable level of income, experts emphasize. Therefore, the initial amount of funds must be sufficient and correlate with the current value of those assets that the investor is going to trade.
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Disclaimer: Bitxmi News is a news portal and does not provide any financial advice. Bitxmi's role is to inform the cryptocurrency and blockchain community about what's going on in this space. Please do your own due diligence before making any investment. Bitxmi News won't be responsible for any loss of funds.