How Much Invest in Cryptocurrency in 2021, According to Experts

The sharp decline in Bitcoin in October is a complete study of the risks associated with crypto investment. Cryptocurrency is still a highly volatile investment, which tends to fluctuate significantly over time.

How Much Invest in Cryptocurrency in 2021, According to Experts

Still, everyday investors want to know about crypto. Some of the most visible financial influencers are also starting to talk and think about crypto more."If you invest a certain amount, you are probably right if you lose that amount."

As with any new investment, it is important to do your research, and understand all the risks. Experts say that you should not invest in crypto if it means that you cannot meet other financial needs, such as paying off a debt, building an emergency fund, or withdrawing other retirement accounts. And just because crypto is new and popular doesn't mean you need to invest in it - people have been saving successfully and retiring for a long time before crypto.

So how much more so, if you are going to invest in Cryptocurrency? According financial advisers to consider what they told the investor.

Vrishin Subramaniam: 2-5% of your net worth

Vrishin Subramaniam Financial Planner/Advisor says — Investors who are interested in crypto market should have between 2 and 5% of their net worth in it.  Vrishin Subramaniam, founder and financial planner at CapitalWe. “2 to 3% is usually what we see for most clients who are not tracking crypto markets more than once a week.” 

The risks and volatility associated with cryptocurrency has much to do with its relatively short track record, at least compared to the stock market. Subramaniam advises clients that they can adjust their crypto strategies accordingly as more time passes and we learn more about its performance. But until then, Subramaniam recommends reducing your risk by keeping crypto holdings to a smaller share of your investments.

Michael Kelly advice 1-2% invest in Crypto

Michael Kelly says it's totally Depending on your situation, a low allocation can present new opportunities for a healthy investment portfolio, CFA at Switchback Financial. But must remember, crypto is volatile. 

“Depending on the client’s unique risk return profile, I see that a very minimal allocation, 1 to 2%, can be a potential opportunity,” says Michael Kelly. “I view it as a valid asset class in a portfolio due to its lack of correlation with the traditional investments of stocks and bonds.” 

For Michael Kelly, crypto’s volatility and unique characteristics also present an opportunity. “Although it is high volatility, the lack of correlation reduces the overall portfolio volatility and provides the potential to have significant upside for returns. Having just a small allocation in a portfolio can have massive return potential with minimal downside risk.”


Friends, if you are planning to invest in Cryptocurrency in 2021 Then this post will definitely help you. 

If you have any questions about Cryptocurrency please ask in comment section.

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