Some common blunders that I have noticed people done over the last few years. Avoid these mistakes and be better than 80% of other investors or traders. Despite, people know these mistakes already, Still they make these mistakes at least a few times before they get failed and learnt a lesson by loosing all their savings.
Be emotionless as a trader. Emotion is a trap for investors. If you got some good gain then you should come out and keep an eye on the more down price of the bitcoin or any other cryptocurrency or any stock. I have seen some traders who bought bitcoin at $20K and if you remember that that was the peak of the bitcoin. They bought at that position and didn't realize that they should have put some stop loss in their mind. They were only thinking that it will go up and up (That might be the case but you should always come out some loss level so that you can reenter again). So what happened then? Bitcoin goes down and down and came at $10K and those traders didn't set any stop loss in their investment note. Now here at that point, their investment and trust got burst and they sold and came out of the market.
Let's assume if those traders set a stop loss on their money (Some exchanges do not give that stop-loss option but you can set it in your mind that you will only bear that much loss and come out and wait for more downfall) like set stop loss at 5% of your investment (5% is a high percentage in the Stock market but not in Crypto market). So let's do some rough mathematics. Let's assume you bought 1 BTC at $20k and you set 5% of stop loss. And BTC goes down so you faced a loss of $1K ($19K remaining in your account). But if you didn't set that stop loss then you face loss off $10K.
So in stop loss scenario, you faced loss of $1K and came out and you kept an eye on more downfall and now you reentered at $10K rate of 1 BTC. So now you will have more than 1.9 BTC ($19K) in your wallet. So, in this case, you saved a lot of money from getting lost. And from here you again don't forget about setting a stop loss. And here now you have a great chance of earning from the UP side fluctuations because after going down that much it recover to some value around $12K in some time. I hope you understood the overall thing.
Buying all or Selling all or Buy Nothing or Sell nothing
Some inexperienced traders sell all their bitcoins or buy bitcoins from all of their money. But expert traders only sell 20% of their BTC when they get 50% hike on their investments and another 20% seel when they make 100% hike and this goes on always. They sell 20% BTC always whenever they get some hike. In that way, they make a profit and always have money in their pocket to buy more when it goes down. If you don't take out some money then you will not be able to buy more on dips. So always have backup money in your pocket to buy on dips and sell on high. People are greedy and that's why they don't take out their profit and wait for more and more gain. And that makes them an empty pocket.
Investing all money in 1 Coin or Stock
Never buy only one coin from all your investment. You should always shortlist at least 10 coins or stocks where you like to invest. And divide your investments at least in 4-5 coins. This is because if you any coin gives you loss then you have some other coins who will give you profit and overall you will not face loss. In a very rare case, you may face loss.
Putting all the money in one Exchange or Wallet.
If you are watching the news then you must hear about the exchange being hacked. So always distribute your investments in multiple Exchanges or wallets. If hacking happens in any case then you will not lose all the money.
Investing more than you afford to lose
If you did this then you will surely be emotional on your investments and then it will make you empty pocket or bear heavy losses.
Investing in coins which are hyped without any background tech improvement.
Don't invest in coins which don't have good backup support and development team. Still, if you want to invest in those coins then you can invest 10% of your total investment because those coins either gain or lose 2000% So it's fair to take a chance on 10% of your investments because of their high price fluctuations to earn a lot of money in quick time, But remember you can also lose all of your investments in that coin. (Remember Stop Loss always)