Taking Profits: Crypto != Stocks (Maybe?)

It's The Wild West Out There

I've heard this phrase many times over the years that I've been into cryptocurrencies. Back in 2015, I couldn't take it anymore. I sold the vast majority of my stocks and went all in with BTC and alts.

Lately I've been contemplating something that a friend once told me about trading stocks, and I have had a hard time applying it to crypto. In fact, I don't know if it even applies or makes sense at this stage of the game.

You see, my friend suggested to me that as soon as my stock gains 50% from what I paid for it, I should sell half of it. That way, whatever I do; I can't lose. After all, I now half half of my shares, plus I'm holding my initial investment in liquid cash.

I have tried over and over again to do this with my crypto, but I just can't seem to manage it. (But it's so early! We don't even have mass adoption yet!) What I've done many times, is take that 50%, and invest it in another coin. Of course, then you are left with that creepy reminder of volatility all the time.

Other times, I've taken profits and dumped them into cash to pay a bill or two. Then, when some coin that I like takes off, I'm stuck with the pain of realizing that the money I took off the table could have made me some serious gains had I not spent it on lame bills. (stupid bills!)

So perhaps I could let it sit in a stable coin. Doh! But then it's not working for me. What if I miss a rally?!?

Herein lies the problem. The main difference that I see between stocks and crypto from a trading perspective is the insane daily percentage changes that crypto can have relative to stocks. And to top it off, it's traded worldwide, 24/7! All of the variables can drive one crazy.

Once Again, It's Down To Emotions!

I have been coming back to this a lot lately. Even though it's always been sort of obvious and in the back of my mind, emotions have to be taken out of the equation. Another wise trader also told me that you have to have a strategy and stick with it. At least if you fail, it's not because you were flailing, confused and panic trading. You had a plan and you followed it. Perhaps it was a bad strategy?

So ultimately, you have to decide what it is that you want to do. Do you want to be a stressed out day trader, or do you have some money that you are ok with losing, and are willing to be in for the long haul? Are you ok with taking some profits, and risk losing out on some 500% or more gains?

You have to decide what it is that you want. Don't be a victim of your own monkey mind, changing your strategy at the speed of your constantly evolving emotional sensations. No one makes any money this way. Not unless they are extremely lucky. Sit down and figure out what it is that you want exactly. Then build a strategy based around sanity!

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