Hello and welcome to Investing 101, where you will learn how to invest in Ethereum the right way. In this article I will be going over everything you need to know about investing in Ethereum, from what an investment is all about, buying and selling strategies for maximizing your profit potential, and taking a look at what makes Ethereum so special when compared with Bitcoin.
Investing in cryptocurrency can seem daunting for beginners because of the complex language surrounding it that is very confusing. This article seeks to break down investing terminology into easy-to-understand concepts that are not only useful but also crucial if you want to succeed as an investor.
Investing is the act of putting your money or capital at risk in order to generate a return, such as an increase in value and/or income. Investments can range from stocks, bonds, mutual funds, ETFs (exchange-traded fund), fixed incomes products(such as certificates of deposit and US Treasury bills) to commodities such as gold and silver.
Bitcoin is an asset that can be traded on many major exchanges, but Ethereum differs in that it is more of a utility token than a tradable asset like Bitcoin.
Ethereum has been bullish for the last few weeks with positive growth to both its price tag and market cap; this continued trend will likely continue for some time.
In many ways, Ethereum is one of the best cryptocurrency investments compared to Bitcoin due to its lower volatility and more utility-like use cases.
Investing in cryptocurrencies can be a rewarding undertaking but it also carries with it plenty of risk; before investing, do your research to ensure that you are keeping yourself on the safe side!
When buying or selling ETH for maximum profit, make sure you're using the best exchange rates.
Ethereum is a cryptocurrency that has been gaining a lot of attention lately, but there are still many people who don't know how to invest in Ethereum. One reason for the rise of ETH may be due to an April Fool's Day prank published by The Guardian which claimed that Facebook had purchased the currency and was going "to create its own digital currency."
Another reason may be due to the fact that Ethereum is a decentralized platform, which means it's not owned by any one company. This makes investing in Ethereum less risky than investing in other cryptocurrencies like Bitcoin.
There are many ways to invest in cryptocurrency and this article will go into detail about investing in Ethereum (ETH).
Buy-and-hold investing is one of the most popular methods to invest into cryptocurrency. Put your money into a coin, hold on tight and see how it performs over time. For example, if you buy $500 worth of ETH at an average price for that day with all other things being equal; if ETH were to rise in value from $500 to a peak of $1000, your ETH would be worth approximately $1500.
However, investing in Ethereum is not as simple as buy-and-hold investing. You need the know when to enter and exit the market for maximum profit potential.
To make these decisions it's important to study charts that show the historical price movements of Ethereum. This is called technical analysis and it's a powerful tool for making educated investment decisions based on past data.
There are two main scenarios to think about when deciding where you should invest your money in ETH:
In each section, we'll talk about some of the most important things to consider when investing in Ethereum.
The first section is for investing long term and this scenario will be best suited for investors who want to invest a large sum of money or hold onto their investment for years at a time. The second section is short-term trading which would suit investors who want to invest a small sum of money and are looking for quick gains.
Picking the right time is key when investing in Ethereum so it's important you read this article carefully before deciding what your next move should be.
Long-term investing: We will talk about "buy low, sell high" strategy which has been proven as the best way to make money in the stock market.
The most important thing is that you don't fall into the trap of panic selling when there's a sudden drop in price or buying more Ethereum just because it has gone up significantly in value. It's easy for beginners to get caught up on short-term gains but this strategy can be risky.
Selling your Ethereum: If you want to sell your Ether, then it's important to wait until the price is at its highest point in order to get maximum profits. It doesn't make sense when people are selling their coins during a dip because they will end up missing out on future gains.
The best time to buy Ethereum is when the price dips. This may occur during a bearish market or right after some major news event that causes uncertainty in the future of ethereum. Buying at this point will give you an opportunity for profit as prices go back up again. One good example was on January 16, 2018 where ETH dipped to $751.41 before going back up again.
The best time to sell Ethereum is when it's at an all-time high and you want a quick profit for your investment. ETH reached its all-time high on January 13, 2018, with a price of about $1400. ETH has reached an all-time high again on June 21st, 2018 with a price of about $400.
This means it's best to sell your Ethereum at that time and take profit instead of waiting for the price to go higher or lower. It's better not to risk investing in a market that is moving so quickly and you could potentially lose your money.
Ethereum can be bought and sold on many cryptocurrency exchanges. The most popular sites to buy Ethereum are Coinbase, CEX.IO, Kraken, Bitfinex and GDAX. If you don’t have a bank account or PayPal linked to your credit card for whatever reason like privacy reasons then the best way of investing in Ethereum is through Luno if you are residing in Asia and Coinbase if you are residing out of Asia.
Ethereum coins are usually stored in a wallet. There are many different Ethereum wallets and they have varying degrees of security, or something is lost may happen to your funds. Some people use the free Luno wallet while others opt for storage on an offline USB drive (cold storage). The best option really depends on how much you hold as well as your individual risk propensity.
If you are looking for offline cryptocurrency wallet, here are some of the best ones you can't go wrong with:
This is a difficult question to answer, but it will be an important one for many people who are trying to decide which cryptocurrency they should invest in. There are pros and cons about investing in Ethereum that you need to take into account before buying ETH.
The price of Ethereum has been increasing rapidly over the past few months so there is a chance that the price will continue to increase
However, Ethereum has been experiencing low volatility which is considered an advantage in investing. This means if you invest now, your risk of losing money would be lower than with Bitcoin because it fluctuates more wildly
The downside for investing right now is people are anticipating a correction due to some of the factors affecting Ethereum. There is no guarantee that it will keep going up, so investing now may not be good for some people
Investors need to decide if they want more risk or less by looking at what kind of market conditions are in place right now. You can invest and then get out once you see a correction coming which would decrease risk.
The price may go up and down, but that doesn't mean you lose your investment or get back less than what you invested in the first place. It's important to remember this when investing because there will be some volatility (volatility is a measure of risk).
If it does drop significantly then wait for a correction before investing again. The price will go back up and it's usually a good time to invest because the prices are lower than they were before the correction.