Crypto Investing in 2022 – Portfolio Risk Management for Beginners!

This video is sponsored by pioneer x but more on that later hey everybody it's eddie here and in this video i'm going to be giving you a complete breakdown of my entire crypto portfolio and i'll also be talking about crypto portfolio risk management i think this is a topic that's not really talked about a lot so i do want to cover that so if that.

Sounds interesting definitely stick around also just a reminder that i'm not a financial advisor nor anything that i share in this entire video financial advice so make sure you also do your own research due diligence before you decide to move forward all this is pretty much my personal strategy how i like to navigate through the markets so this is.

Just one person's opinion so right now this is my portfolio as you can see the majority of my portfolio is made up of bitcoin around 47 second after that is going to be ethereum making around 25 of my entire portfolio third being cardano making up 8 and you can see the rest following now the way that i like to structure my.

Crypto portfolio is to have anywhere between 45 to 50 in bitcoin 25 in ethereum and 25 in all coins generally i like to hold much safer quality all coins like polygon polka dot chain link etc but within that 25 of the all coin section with five percent of it i like to take on a little bit more risk or be a little.

Bit more experimental try crypto bots rebalancing bots or hold on to different altcoins that i don't really typically invest into so the general idea is to be very low risk now the reason why portfolio risk management is really important is because you're trying to minimize your risk to the downside but also trying to maximize your gains to.

The upside you know there is no such thing as low risk and high reward there's only high risk high reward or a low-risk low reward but there is a good balance for example let's say that your entire crypto portfolio consists of 100 bitcoin technically that is the low risk low reward route also it's very conservative considering the entire.

Crypto space but if you want to take a little bit more risk then you would do something like 80 bitcoin 20 percent ethereum you want to take on a little bit more risk than you would do 50 bitcoin 50 ethereum you get my point right the more exposure you have into bitcoin basically you're protecting your portfolio the less bitcoin you hold.

Basically you're increasing your risk but just holding bitcoin and ethereum in your entire crypto portfolio is still considered a pretty conservative safe route in my personal opinion rather than holding a different altcoin now the app that i'm using to track my entire crypto portfolio is called coinstats it's an amazing app if you guys are interested.

In signing up i do have a referral link down below where you can see 41 of your entire subscription but the number one beginner mistake that any person can make is by saying things like i own 1 000 cardano i own 2 ethereum 20 polka dots it really doesn't matter how much of what you own for me i don't really care about the number of bitcoin or.

Ethereum or cardano or rose or bmb that i own for me it's all about the percentage allocations and depending on the percentage that's going to help me determine what to invest more into and what not to invest into because the most common question that i also get is eddie what should i buy what's a good deal right now and people that typically ask.

Those questions don't have a portfolio strategy or don't have any strategy at all for example right now my bitcoin allocation is around 47 right but there was a time when it went as low as 42 at that point that meant that my exposure to all coins were much higher which meant that my portfolio was entering a higher risk territory.

Therefore i stopped on accumulating any sort of all coin including ethereum and just focused on accumulating bitcoin every single day once it made up around 45 46 47 of my portfolio that's when i was like all right what should i invest into next if ethereum drops down to like 24 accumulate a little bit more ethereum.

And i also don't have to add any more all coins but i can increase a little bit more exposure to my experimental portfolio which makes around five percent of my entire portfolio if you look at uh my portfolio you know 1.8 percent of my portfolio is gusd i know it's technically a stable coin but the way.

That i inputted the data is for that 1.8 percent to be my trading bots within my pionics account also we have the 1.4 which is the other sector that is also trading bots with my pinx account if you guys are interested in signing up for pioneer x i do have a referral link down below you can save a ton on your trading fees they have one of the lowest trading.

Fees that i personally know of and the reason why i love using them is because they have so many different token options along with amazing trading bots to strategize your entire investment decision so around three months ago i created three different trading bots within my pionics account to talk about risk management so i think this is going.

To be a perfect example what that looks like but my first spot is down 41 my second bot is down 44 so 3 more and my third bot is down 47 so another 3 more for bought number one bitcoin made up forty percent ethereum being thirty percent and the rest of the thirty percent being cardano polka dot and v chain on the second bond we had no.

Bitcoin and say we replaced that with ethereum being forty percent of the portfolio 20 being cardano and polka dot and 10 being matic and v chain and with bot number three we have no bitcoin no ethereum so obviously this is more of a higher risk higher reward approach 40 being cardano 20 polka dot 15 matic and v chain and 10.

Xrp just to have a little bit more risk but high reward at the end of the day these are very speculative right they may go to zero they may not even reach to their all-time high or they might do like a 2015 x who knows but it's very clear that when you don't hold any bitcoin or ethereum you're going to experience more downside during a.

Correction so right now you know this portfolio is down 47 the one with just the theorem is less 44 and the one that i'm holding bitcoin and ethereum is only down 41 versus the 47 now maybe some of you watching this video are actually down 50 what should you do in those moments that is going to be completely up to you but.

I'll tell you what i will do the last thing that i would personally not do is sell at a loss instead i would increase my position by adding more to dollar cost average down because if i sell at a fifty percent loss number one i only have the half amount that i invested in this case i invested one thousand dollars i would only get five hundred.

Dollars back now if i want to recover my 500 loss back then the market has to do a 2x versus if i just held the market just has to do a 50 increase in other words you have to work much harder or the market has to work much harder for you to get your money back so the next best thing for me to do when things are down like forty to fifty percent what i.

Would do is double down on my investment now i just went ahead and deposited three thousand dollars into my pinex account i'm going to be investing a thousand dollars each so 1 000 into option number three two and one also if you're interested in learning more about pinex and how to use their platform i do have a dedicated playlist linked down.

Below but let's go ahead and deposit one thousand dollars in so for option number one or trading part number one we're down 41 percent if i go ahead and click on add investment i'm gonna go ahead and add in a thousand dollars so in other words i'm dollar cost averaging down i'm gonna click on confirm and now my trading bot number one is only down.

Twenty percent versus the forty percent so basically what happened was i bought up here way too high i dropped down forty percent damn i'm in a loss right so what did i do i added more to my position i bought low and once the market starts to recover that profit is going to make up for the losses in other words i'm going to cancel out much.

Sooner than later the market only needs to go up 20 for me to break even versus the entire 40 so that's why it's also important to have cash on hand to buy the dips into average down for portfolio number two same thing click on the three dots add investment we're gonna go ahead and add another.

Thousand dollars okay confirm and now i'm down 22 versus the 44 and we're gonna do the same thing for bot number three go ahead and add the rest of the thousand confirm so right now i'm down around like forty seven point four percent so i'm gonna guess divide that by two which is going to be around 22.23.

23.5 percent i think it's around 23.5 percent so down 23.7 not bad much better than the 47 now what if you know a couple months down the road the market decides to continue to correct and go lower and all these portfolios decide to go back to the 40 to 50 range well that's another video for another time but the simple.

Answer is i would still dollar cost average down now a couple months back i did set up another bot called the arbitrage bot now this bot is very interesting right because it's a very safe and conservative way of investing it's kind of like earning interest on your stable coins right now i'm earning around 7.8 that number increases.

Depending on the market conditions i made a total of 316 dollars in the past 145 days and this bot is arbitraging ethereum i did create a separate video on this again it's in the playlist link down below but i'm actually going to close this one out today because i'm gonna set up a new bot with you all so we're gonna click on the power button.

Are you sure you want to close the east spot futures arbitrage bot yes i do confirm and now my available balance is 10 326 now the reason why i closed this bot out is because according to my portfolio and my strategy i can increase my exposure to my experimental or high risk portfolio which makes up around five.

Percent of my entire portfolio all of this will make sense in just a second but i'm going to go ahead and click on bot and the bot that i'm going to be creating today is going to be called the eth moonbot now i've never traded this bot but it sounds really interesting according to what their website says and i'm going to go ahead and give it a try.

Experimented and give you guys an update a couple months later go ahead and click on ether moon total investment ten thousand dollars flat done and create so here's how this bot works eighty-six percent of my funds so thousand six hundred dollars is going to be directly invested into ethereum and then with 13.9 percent is going to be held in.

Stable coin so around 1 390 held in stable coins the ethereum price range is going to be from 1 dollars all the way up to ten thousand dollars so from one thousand to ten thousand dollars ethereum it's going to set up 500 grids so basically it's like setting up a grid trading bot but in this case the ether moon bot has already set the settings.

For you to become the most profitable the idea of a great trading bot is to buy low sell high buy low sell high any time those low grids are triggered it'll automatically buy for you anytime the price goes back up it'll automatically sell for you with these grid trading bots you won't really see the results immediately we're talking about like a.

Day or two you kind of have to give them some time give it a week give it two weeks give it a month and then eventually you'll see some profits coming in and typically i like to set these grid trading bots when the market is down i don't like setting up these bots when they're high up because it's a little bit more risky when things are.

Down and low or kind of in the middle that's a great place to start in my opinion because basically i'm investing 8 600 into ethereum do i want to do that when ethereum's at four thousand dollars or the mid two thousand dollars so i'm going to go ahead and click on okay and now my eth moon grid trading bot has been sent i'll keep you updated over.

Time so this is part of my experimental portfolio so it's sitting around thousand one hundred dollars so within my pioneers account i'm gonna go ahead and click on add transaction click on search gusd and go ahead and add an additional thirteen thousand dollars and that is because i set a ten thousand dollar eth moonbot plus an.

Additional three thousand dollars on each of the bots click on add and now the entire percentage of my portfolio is a little bit different my bitcoin percentage decreased a little bit ethereum is no longer 25 but 24.7 gusd makes up 3.44 and the other category makes up around 1.4 so that is also experimental or high risk so if we.

Grab gusd plus other so 3.44 plus 1.41 that is equivalent to around four point eight percent almost five percent which is in my portfolio risk area and so this is how i personally manage my risk when it comes to investing into the entire cryptocurrency space my portfolio tells me what to do not based off of my emotions in this case now my portfolio.

Is telling me eddie you should consider accumulating a little bit more ethereum a little bit more bitcoin but i'm not going to be accumulating more ethereum just because i set up an ethereum bot right so technically i do hold ethereum just not directly now i hold my crypto across 11 different exchanges and apps you don't have to be like me i just do.

That for my own personal reasons but if you want to manage it in one place i think pioneer x is also another great alternative for example let's just say that you want to create a portfolio 60 bitcoin 40 ethereum and you don't really want to manage it and you want to try to maintain that balance well within pi nx you actually can do that right i'm gonna.

Go ahead and click on create a bot and it is called the rebalancing bot click on create and it's gonna give you two options dual coin mode and multi coin mode dual coin mode if you choose that you can choose up to two coins and it's gonna split it evenly 50 50 but because i want to manually make it like 60 40 i'm gonna click on multi coin mode click.

On customize add a new coin bitcoin and ethereum confirm the two coins and from here i can manually input the percentage right this is really cool because i can do something like 70 and for ethereum i can do 30 done and this rebalancing bond is going to maintain the 70 30 ratio at all times for example if.

Ethereum ever outpaces bitcoin it's automatically gonna sell profits from ethereum and put that into bitcoin vice versa if bitcoin decides to take off then it's gonna automatically sell some of that and put it into ethereum so that your portfolio is always balanced so in my opinion this is another great alternative to managing your risk of.

Your portfolio for me i'm going to increase my exposure to ethereum to to do something like a 60 40. i think ethereum's a great project it's definitely a much more safer altcoin alternative than other all coins out there also you need a minimum of a hundred dollars per coin so in this case because i have two coins i need a.

Minimum of two hundred dollars if you do three coins then 300 four coins 400 right so the max amount that i'm gonna do is 326 and then i'm gonna have it set to rebalance every four hours so basically what's gonna happen every four hours pinex is gonna make sure that sixty percent of my portfolio is sitting in bitcoin and forty percent in ethereum.

And the bot has been set so this method is pretty much just like buying and holding but it automatically does a rebalancing for you well with that said hope you all enjoyed this video if you did please give it a big thumbs up if you have any questions or comments leave it down below consider checking out the patreon group link down below as well.

That is where i post content on there every single day that i am not on my public channel also hopefully this video was helpful hopefully it gave you some insight on how to move forward and strategize i know investing into the entire crypto space can be extremely stressful at times sometimes you wonder did i make the right decision am i.

Making the right decisions sometimes you really don't know but again this entire video was about portfolio risk management so if you position your portfolio and you manage your risk then it doesn't have to be stressful i'll see you guys in the next video over goodnight good morning adios
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