The crypto world is constantly changing, and navigating through the volatile market can be challenging, even for the most experienced investors. For the most part, the investors opt for the time in the market because it can reduce the impact of volatility in the market.
Having said that, the unpredictable habit or nature of these crypto markets makes it challenging for investors and traders to time the market and forecast the right time to exit and enter profit-oriented trades.
To reduce the stress of timing the market and to reduce the impact of volatility in the market, various investors opt for recurring investment strategies, which are also called time in the market. Various crypto exchanges, such as thequantumai.app, are opting for recurring investment strategies for managing the portfolio. So, with this article, we are sharing more information on crypto recurring investment and more!
Recurring Investment – What Is It?
Recurring investments are defined as the method of investing a certain amount of money regularly, and it could be on an automated basis. For this purpose, the dollar-cost averaging strategy is integrated to build the portfolio, and it’s done by investing small amounts of cryptocurrency regularly.
It is a suitable method for traditional investments as well as cryptocurrency investments, which allows the investors to acquire more assets at much lower costs as compared to what someone would pay for the lump sum investments.
Benefits Of Adopting Recurring Investment
Investing in cryptocurrency regularly has various benefits as compared to collective or lump sum investments. However, in the section below, we are sharing the essential benefits of adopting recurring investments, such as;
With recurring yet small investments, it is evident that the investments will start spreading out shortly, which allows the users to grow the crypto portfolio with the help of new funds consistently. With the growth of crypto projects in the development phase, the token price, profits, and revenues will grow.
In addition, investing for a longer time period ensures that you won’t miss out on the growth because you will be accumulating the assets on a regular basis.
Better Risk Management
The recurring investment has the capacity to manage the risks and impact of the volatile cryptocurrency market. So, rather than hoping for lump sum investments, you will be able to spread out the investment, and it will smoothen the ups and downs of the market.
In simpler words, you have to ensure that you aren’t putting all the eggs in one basket. For instance, when you break down the investment in small chunks, it allows better investment in the financial world, which means the users will have the flexibility of reducing or increasing the investment, irrespective of the market conditions.
If you have been in the crypto world for a long time, we are sure that you have made some impulse trading and how they can impact portfolios. For instance, emotionally charged investments can make investors sell their investments impulsively and miss out on the dipping prices.
Having said that, the recurring investments will help crypto traders disconnect the emotions and feelings from investments. As a result, the investments will be more disciplined, irrespective of the market conditions.
Setting Up The Recurring Investments
If you are ready to take on recurring investment as a form of strategy for your cryptocurrency journey, there are two things that you can try!
- Recurring Buy – this is a feature designed on different cryptocurrency exchanges which allows the users to automate the crypto purchases, and it operates on the DCA strategy. The DCA strategy allows the users to select the cryptocurrency that they want to purchase, the investment amount, and the frequency of purchase. As a result, the users won’t have to go through the hassle of manual purchases by automating the purchases.
- Mechanics – it allows the users to purchase cryptocurrency with the help of fiat currency, with which you can opt for weekly, monthly, or bi-weekly purchases. In addition, the users can set the time and day for recurring purchases, but you have to connect the Mastercard and VISA.
The Bottom Line
When it comes down to recurring investments, it’s the best way of saving time, and various cryptocurrency exchanges allow the setup, so it’s time you research the available options and optimize your crypto investments.