Crypto Trading Vs Investing

This is Not Financial Advice!

Investing in Crypto

Before diving into the differences between crypto trading and investing, let’s break down these two concepts. Crypto investing is a strategy to make money from the crypto market by buying and holding crypto assets with the hope of profiting from an increase in their value over a longer period. It attempts to create a long-term position and HODL through the downturns and upturns.

Crypto Trading

Crypto trading involves buying and selling crypto assets over a short time, i.e. minutes, days, or even weeks. Crypto trading is the process of leveraging the high volatility of the cryptocurrency market to make profit in the short term. This process usually requires more effort in monitoring market moves.

Differences between Crypto Trading and Investing

To further understand the differences between trading and investing, let’s go a step further and examine these differences.

  • Period and Time frame
  • Trade frequency
  • Analysis
  • Risk aversion
  • Profit diversity
  • Capital required

Wrap up

Understanding the differences between trading and investing is essential because it would help determine how you want to play in the crypto space. Experts often advise never to invest or trade more than you can afford to lose, but the choice is totally up to you, bearing in mind factors such as your risk appetite, your availability to trade, and the time frame you have in mind to profit from your involvement in the cryptocurrency market.

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