The majority of Indians regard festivals as favorable times to invest in gold and other valuables. While gold is often regarded as the safest asset class, it does come with its own set of risks. The cost of holding real gold as well as the cash necessary to invest in gold are both significant.
Gold investors would argue that one of the most important characteristics of gold is its capacity to act as an inflation hedge. Although this has been the case in the past, it may not be the case presently! In India, the younger generation is gradually beginning to diversify their financial portfolios beyond gold. As a result, the asset class of cryptocurrencies is formed.
This asset class has provided a significant return on investment and is entirely digital, removing the bother of holding a high-valued physical asset. Unlike gold, cryptocurrency investing does not require a large initial investment.
Several Indians have already made the initial step toward investing in cryptocurrencies as investor awareness has grown.
This Dhanteras may be the ideal opportunity to take the first steps toward establishing a crypto investing strategy. The best course of action would be to select a few prominent cryptocurrencies and diversify them.
Looking at the top 10 cryptocurrencies by market capitalization is a good place to start if you want to get into this asset class. These coins have been around for a long time and have come a long way. Diversifying between these currencies is the best strategy to get started with crypto investment.
With time, investors may be able to look for tokens with smaller market sizes and solid use-cases that will generate significant returns in the long run.
Cryptocurrencies are not a way to become rich quickly. Investors should be aware that all investments have some level of risk. The risk is higher because it is still an unregulated asset class. Investors should not put more than 5% of their net worth into cryptocurrency.
Expecting unrealistic profits is a certain way to end yourself in a Ponzi scam, which should be avoided at all costs. Investing in cryptocurrencies properly might yield a monthly return of 5%. It means that investors might quadruple their money in less than a year! Such profits would satisfy any seasoned investor.
This Dhanteras might be the ideal time to take that first step and start investing in cryptocurrency. This asset type should be a part of every investor’s portfolio. The potential for generating alpha or returns is enormous. Diversification is, therefore, the most important factor.
It means that one should diversify their investments across various asset classes such as equities and real estate, etc along with investing in cryptocurrencies.