Beginner Tips On Getting Started Trading Stocks And Cryptocurrency in 2023
If you’re considering getting into trading stocks or cryptocurrency in 2023, there are a few things to consider before making a decision.
First, it’s important to understand the difference between the two financial instruments. Stocks represent ownership in a company and can be a more traditional form of investment. Cryptocurrency, on the other hand, is a digital asset that operates on a decentralized blockchain network.
Get To Know Your Risk Tolerance
One thing to consider when deciding between whether to trade stocks or cryptocurrency is the level of risk. The stock market can be volatile, but it has also historically shown strong returns over the long-term. Cryptocurrency, on the other hand, is highly volatile and has the potential for significant price swings. So you will want to base your decision on how comfortable you are with price volatility.
Make Trading Hours For Yourself And Stick To Them
Another part of risk tolerance is in the timing of the markets. Stock markets are open and traded during standard business hours in most cases. Many traders base their day on the opening of major markets like the New Your Stock Exchange. This limits the amount of time assets are traded and gives traders the ability to have more of a work-life balance.
Cryptocurrency markets are open 24 hours a day, 7 days a week. This means the price can make moves any time of day, which can cause some serious sleep and anxiety issues for new traders. If you decided to trade the crypto markets, it’s wise to make a trading time for yourself and stick to it. Don’t keep trades open overnight unless you are practicing more long-term swing trades and you have appropriate risk management set like stop losses.
Think About Your Investment Timeline
Another factor to consider is your investment horizon. If you’re looking to make bigger gains on a short-term investment, cryptocurrency might be a more suitable option due to its high volatility and liquidity. However, if you’re looking to make a long-term investment, stocks might be a better choice due to their potential for steady, long-term growth and the possibility of earning dividends while you hold the stock.
Trade What You Know
It’s also important to consider your level of knowledge and experience with each type of investment. If you’re new to the world of investing, it might be wise to start with stocks as they are a more traditional and well-established form of investment. Investing in companies that you know is a great way to get started because you can do research on the company and know whether or not it is a good fit for your portfolio or trading playbook. If you’re more familiar with cryptocurrency and the underlying technology, it might be a good option for you.
Be Smart And Don’t Lose Money
Ultimately, the decision to start trading stocks or cryptocurrency should be based on your individual financial goals and risk tolerance. It’s important to carefully consider your options and do your own research before making a decision on what assets you will start trading.
You could start by opening a trading account on a brokerage like Robinhood that offers commission-free trading for both stocks and select cryptocurrencies.
Nothing said is financial advice.
This is for educational and recreational purposes only!
Stay safe in these volatile markets and don’t get rekt!
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