Welcome to BitBoy Crypto!
The people's channel
Home of the BitSquad
The largest and greatest crypto community in all of the Interwebs
My name is Ben.
No channel works harder to keep you in the know about crypto.
Now, today, we're actually going to be continuing our series
on our five investing philosophies.
I want to show you guys our new building.
There you go. Look at it. Hit Network.
We created Hit Network after BitBoy Crypto,
but Hit Network is now like the parent company of all the different things that we do here.
So pretty good.
Not too much going on the inside yet other than in the back rooms,
but we're going to be building that out here pretty soon.
So super excited about that.
So I thought I'd start the video out here.
Now, today, we're going to be talking about our third investment philosophy.
Now,
build a balanced portfolio.
That is the philosophy.
And I know we did these Monday and Tuesday last week,
and I said I was probably going to do all five last week,
but I just didn't think with all the stuff going on between Russia and Ukraine
that it was the proper time to continue with the investment philosophy videos.
Now, you know, I mean, still, you know, just as urgent of a matter,
but I do feel like, you know, at this point, it's okay to continue on on this series.
So let's talk about building a balanced portfolio.
Let's talk about what that consists of. Okay?
So, No. 1, the most important thing is practice proper diversification.
Now, a lot of people will tell you you need to diversify your portfolio.
And that's 100% accurate. You have to diversify.
A good range of coins for your portfolio is anywhere between 8 and 20 at the max.
You really don't want more than that.
We've got a lot more than that, so we're actually looking at, you know,
consolidating a lot of our holdings here pretty soon.
Not that we want to give up on projects, but, you know, we just think--
you don't want every single coin out there, you know?
If you do, you're kind of, you know, shooting yourself in the foot.
A lot of people when it comes to diversification,
you know, we know that you don't want to have two coins or one coin.
A lot of people say,
"Oh, you really believe in XRP? Why don't you go all in on XRP?"
Well, nothing is guaranteed in crypto.
Nothing is guaranteed.
That's why you want to have a wide assortment of coins.
A lot of people will go all in on one coin, and they'll get burned when it doesn't move,
and then, eventually, they'll just move to another coin,
and they'll, you know, usually sell in the red and buy in the green.
That's not good. That's not what we want to be doing.
We want to be making smart decisions with our portfolios.
But on the other side of this,
you also don't want to overdiversify,
which is the spot that we're in right now.
And a lot of it is because we've done videos on different coins,
and because of that, we haven't wanted to sell them
because, you know, we do a video, we don't want to get out of the coin
because we feel like we have a responsibility.
But we haven't done any of those videos here in a long time,
so we are going to be consolidating our portfolio.
Some stuff we don't want to give up on.
We're just going to move on to stuff that we, you know, kind of, you know,
we talked about our second investment philosophy.
You know, we're only going to invest in stuff that we believe in,
are going to be here for the long term.
So we're going to be moving out of a lot of different coins.
But you don't want to overdiversify.
When you have 100 coins in your portfolio--
let's say you have $1,000 in each coin.
Let's say you have 100 coins.
It's a lot of money.
But let's just say one of them pumps, you know, 10%.
Well, okay, you made $100.
Let's say one of them pumps 500%.
Okay, now, you've done pretty well.
Now, you've made, you know, $5,000.
But what about all the other coins that are just sitting there?
If you only had 20 coins,
that same pool of money, and one of them pumps 500%,
now, you've absolutely crushed it.
You've done extremely well.
So don't overdiversify. Don't underdiversify.
But also make sure you're diversifying across niches.
That's going to be really, really important to do.
So, next, the next thing that we're going to want to make sure that we do
when it comes to proper diversification and building a balanced portfolio
is that you're definitely going to want to make sure,
and this is very, very, very important,
that you're not getting married to your bags.
Don't get married to your bags.
Now, what do we mean by that?
That means, let's say you invest in a coin,
and it looks like it's going to do really well, and you're super excited about it
for the long term,
well, that's great.
However, what if that project starts to go awry?
What if an important team member leaves?
Like, let's look at EOS.
EOS is a great example.
EOS might have been in one of your, you know, your portfolios.
You might have liked the coin.
You might have thought it was going to do very well.
Then Dan Larimer, the CTO and really the guy who created it
and created many other projects before that he left.
Well, now that he left,
it could be a good sign maybe to get out of that coin.
So don't feel the need to stay in a coin for the sake of staying in the coin.
You're going to want to make sure that if a project is going in a certain direction,
and this does not mean, you know, that you don't,
you know, sell in the green and buy in the red,
but what it does mean is sometimes you have to know when to give up.
Sometimes you absolutely have to give up.
Sometimes a project is just not going the direction you thought it would,
and you've got to move on.
Now, this doesn't mean you're moving on because you're bored with the price.
This is a big problem people have,
is they will get bored with the price,
and because of that, they'll move out of it.
Well, what changed with the project?
Nothing? If nothing changed with the project, then that's a bad reason to get out
because crypto punk--
crypto pumps are cyclical. Okay?
So those are definitely two things that you have to do.
You have to practice proper diversification. Okay?
You have to also make sure that you're not getting married to your bags.
And No. 3,
probably the most, the most important of all of these,
is make sure you're mostly investing in top coins.
A lot of people have an issue where they want to come in,
they want to get 100X altcoins.
Now, if you're a true degen, that's all you care about,
then that's one thing.
But if you're building a portfolio for the long term,
you don't want to only be investing in small coins.
I suggest having anywhere between 25-50% of your portfolio into Bitcoin. Okay?
If you're going smaller on the 25% side of things,
then you're going to want at least 25% in Ethereum.
You want 50% of your portfolio, if not a little bit more, to be Bitcoin and Ethereum. Why?
They've made it.
They've already made it.
They're here.
They are-- I don't consider Ethereum an altcoin. Okay?
These are the two coins of the future that we know are going to be around
virtually no matter what.
Ethereum, maybe a little more risky because of ETH 2.0.
We don't know exactly how that's going to work out.
But you don't need to be investing the majority of your portfolio into smaller coins. Okay?
You barely want to go out of the top 100.
You barely actually want to go out of the top 20 to 50.
So you're going to want no more than 5-10% of your portfolio
invested in what I would call riskier assets or projects outside of the top 100,
projects outside of the top 50.
You know, you definitely don't want 15% of your portfolio in coin No. 739 on CoinMarketCap.
That's not going to really be a good strategy.
The people who have been around know that the gains are good enough with the top coins.
That's where the majority of your portfolio needs to be.
And I think that's where a lot of people have been confused
when we've done videos on 100X altcoins or altcoin gems and things like that.
The fact is, is that that needs to be a small percentage of your portfolio.
We've preached that and told that over and over again,
but people don't really seem to get that message and hold on to it.
So that's definitely something that you need to do.
So let's go over all these again.
No. 1, use proper diversification of your portfolio.
No. 2, don't get married to your bags.
And No. 3, make sure you're investing the majority of your portfolio into top coins.
Things that--
once again, going back to our investing philosophy No. 2 and one of the subsets,
you know, investing in stuff that you believe in,
having a long-term mindset.
You're starting to see how all of our investment philosophies are really running into each other
and how using these philosophies together is a very powerful tool
to get the most out of your money.
Alright, guys. That's all I got.
Be blessed.
BitBoy out.