It's time to have a rebalancing plan

With BTC hitting cycle high, I think it is time to consider a portfolio rebalancing plan in preparation of the impending bull market, and of course the crash at some stage.


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If there is anything I learned from the last cycle, it is to really consider what one's investment thesis is. It is more than a plan, it's supposed to be a robust plan.

Rebalancing the portfolio along the way to keep the risk/reward ratio optimal to align with one's investment thesis keeps one's investment safe.

Here is my general consideration.

If I have invested, say 10K into crypto, I need to decide what is the 12 month ROI I expect. Say, if I expect the ROI to be 20% per year, I should just put them in HBD saving. So come on, it should be more than that. Something like 2X could be suitable. That means, 300% from the 100% at the start.

Now, the different assets I hold would have different risk/reward profile. This is where I will need to decide to put X percentage in A, Y percentage in B, etc. The risk and reward will be differ. Basically, if the higher risk assets gains, I will be taking profits off it and put the gains into the lower risk assets.

Most importantly, as I do that along the way, I will keep a close eye on the overall percentage gain in relation to the year's target. If the target is reached within 12 months, a decision will have to be made about how much to invest in the next 12 month period. And of course, a need to set new ROI target, before I try to risk and repeat.

The advantage of doing this is that it is a simple enough strategy to adopt, and using it would prevent one from being lost in the heat of the market and silly FOMO moves!

In a nutshell, have a ROI target, and decide on the assets distribution, keep track, rebalance to lock in profits. Rinse and repeat.


P/S: This is not financial advice, and please do your own due diligence before investing.

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#leofinance @leofinance

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16 comments
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You are right although I would like to invest in low price coin. Like as dogecoin or hive. The average ROI is more for low price coin compared to BTC. the dogecoin has been double based on the last few months but the BTC? So the choice should also include this criteria.

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I didn’t pay attention to dogecoin but perhaps I should!

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I think this bull run didn't go at the direction people were expecting. The altcoins are still yet to make their move

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Whenever there is a profit, some profit must be take

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It's a good plan to have. Taking some profits off the table is always a good idea. It's best to have some plan than not have any. So good luck.

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I think currently now, what is needed is utmost diversification as it is highly needed

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Yes planning is everything. I am also planning this time.

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It is not so easy to take profit from this industry because people get greedy and then get losses, so it is better that when we are getting some good profit, we should do things from the market.

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