How to assess the risk of your cryptographic portfolio
The world of cryptocurrency has made a long way since the start in mid -2010. The key aspect of cryptographic investments is the risk assessment: identify potential risk and limit them before they become serious problems.
In this article, we provide a complete guide on conducting a risk assessment for the cryptocurrency portfolio, helping to make conscious investment decisions.
because the risk assessment is important
Cryptocurrency markets are internally unstable, and prices that quickly flow in response to a market sense. While some investors may be ready to take high risk levels to get significant prizes, others may be more conservative. Therefore, it is important to assess the risk associated with each investment and develop management strategies.
Risk categories
When conducting the risk of your cryptographic portfolio, consider the following categories:
- Risk of marking : This category includes potential losses due to market fluctuations such as price oscillations or differences in the feeling of investors.
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- Risk of liquidity : This category includes the risk that you may not be able to sell your actions quickly or at a fair price if necessary.
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Risk assessment phase
Compliance with these steps will help you carry out a full risk assessment of your cryptographic portfolio:
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- Regulatory research environment : Understanding government policies and provisions that affect cryptocurrency markets, including tax regulations, security requirements (AML) and other regulatory risk.
Risk limit strategies
After identifying the potential risk in the portfolio, it’s time to develop mitigating strategies:
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- Dimensation of position
: Limit the overall dimension of the investment to manage risk and maintain liquidity.
- arrest orders : Set of the arrest orders to limit potential losses if the prices fall significantly.
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