For any investor, the top priority is to protect your capital rather than immediately chase profits. The key to long-term investment success lies in minimizing losses before striving for profits. While this may seem like a simple concept, it is actually quite difficult as it requires avoiding common pitfalls that are common to inexperienced investors.
Here are some important points to consider:
1. Avoid trading futures without experience: Futures trading is a complex and risky activity that requires extensive knowledge and experience. If you are not an experienced trader, you are likely to incur significant losses.
2. Be cautious with influencer recommendations: Relying on buying signals from influencers can be dangerous. Often, these individuals are financially incentivized to promote certain cryptocurrencies without actually believing in their value. This can lead to significant losses as these assets can lose value quickly once the hype ends.
3. Think independently, don't follow the crowd: Crowd sentiment is often unreliable. Once a cryptocurrency gains widespread attention, the opportunity to profit from it may already be gone.
4. Invest what you can afford to lose: To maintain a rational and objective approach to investing, start with an amount that doesn’t put you under financial or emotional stress. For example, if you have $10,000 in savings, investing more than $500 initially could lead to nervous decisions that could result in losses.