It’s been a while since I made a “meaningful” post here on steemit. I just finished my professional exams yesterday and I wanted to make a post so I figured that the best way to come back is by making a crypto academy post. This is my first crypto academy assignment and I have to say it’s been interesting learning a thing or two about crypto.
This assignment was given by @stream4u with the following tasks:
Discuss according to your views on it.
1: Differences in Large Capital - Mid Capital - Small Capital and how they will affect to the Investment?
2: Your view, Which type of Asset capital can be more profitable? Why? Advantages and Disadvantages. (Explain only 1)
3: Thoughts on Risk Capital and Penny Cryptocurrency.
4: What is the Role of Watchlist? Best way to set Watchlist. Additionally, For Example, show your watchlist if you have configured it and give a short description of it.
Differences in Large Capital - Mid Capital - Small Capital and how they will affect to the Investment?
Large capital refers to assets that have a market capitalization of more that $10 billion. By this definition, as of 2019 the cryptos regarded as large cap were bitcoin, ethereum, ripple and bitcoin cash as ranked by Investopedia. Today, more and more coins are becoming large caps as shown below:
Large cap crypto currencies are relatively safe investments but may not yield high returns overtime. They are less volatile and are a better option for safe investors at the expense of high ROI.
Mid capital assets are assets with a market cap in the range of $1 billion and $10 billion. With the relatively lower market cap, they pose a higher risk to investors than large cap crypto currencies with a higher growth potential. There are a lot of coins that fall under this category with popular ones including Trx, doge, etc.
Small capital assets are assets with a market cap below $1 billion with the bulk of coins falling in this category. These coins pose the highest risk to investors among the three categories of market caps because they are highly volatile. They experience very large pumps and dips in a short period of time. Steem is a small cap asset with a market cap of approximately $240 million as of writing.
Your view, Which type of Asset capital can be more profitable? Why? Advantages and Disadvantages. (Explain only 1)
In my opinion, small cap assets can be more profitable because they generally bring higher returns in a relatively short period of time.
Advantages of small cap assets
- Most of them are really cheap and can be bought in bulk to maximize profits.
- They yield high returns in a favorable market.
Disadvantages of small cap assets
- They can experience huge dips in a short period of time.
- They can cause huge loses when huge investments are involved.
Thoughts on Risk Capital and Penny Cryptocurrency
Risk capital is a great way for not just building a portfolio but also for getting used to the crypto world with low and “negligible” capital. The idea of investing an amount of money that won’t be a problem in a case of loss is a good one.
Risk capital investment is of advantage because it:
- Builds experience
- Builds a wider portfolio
- Helps to test a particular market
Steady investment of risk capital on penny cryptocurrencies can compound to a measurable investment if research is done properly.
BTT chart on the binance app
Above is the chart of BitTorrent coin (BTT). It’s a penny cryptocurrency with a recent gain of more than 50%. It sure will be great news for the holders.
What is the Role of Watchlist? Best way to set Watchlist. Additionally, For Example, show your watchlist if you have configured it and give a short description of it.
With thousands of coins on the market, keeping track of a particular group of coins can be quite a task. This is where the watchlist comes in.
A watchlist is a feature where users can create their own lists of cryptocurrencies to follow. " coinmarketcap.com
This is my watchlist on tradingview.com below:
The list above shows the coins I’ve been monitoring closely over the weeks. I’ve been watching bTT for a long time and now it’s one of my top gainers. Steem and SBD have been performing really well over the months. Litecoin and Ethereum were once favorites but I’ll take them off soon enough because of the outrageous GAS fees.
I had btc on my list for a while but I took it off with some other coins to build a much better portfolio. We grow as we go now don’t we.
I’ve been able to understand the basic categories of cryptos by market cap. The lesson was really interesting and I enjoyed the assignment. I’ll do more assignments for sure.
Special thanks to @stream4u