More and more people have been investing in cryptocurrency and other blockchain products in recent months. This of course has come from the fact that the prices have soared and everyone wants to try their luck in this kind of investment option. There are some jargon which you will hear when you are investing in crypto, and today we are going to talk about diamond hands, and what that means.
Experts like Robert Testagrossa have been alluding to the need for diamond hands of late, and here is what they mean. This is not financial advice, we are simply describing what diamond hands means, and why many think you need them.
In a Nutshell
In the most basic terms, diamond hands simply means hanging on to your investment. The reason why this is discussed is because of the behaviors of so many investors. What we often see newbie investors do is buy as the price is rising because they think it’s the best time, and then they sell as the price falls because they panic. The reality however is that you should be looking to do the opposite here, buy low and sell high.
Long Term Investment
The main reason why people talk about having diamond hands is that most of those who are involved in crypto investment are looking for a long term yield. If you ask most experts they will tell you that the major coins such as ADA, BTC and ETH are long term strategies and that you should simply invest and then leave your investment alone.
In the world of stocks and shares there are many people who are able to follow patterns, market news and many other factors, and use that information to trade stocks and shares for profit. When it comes to crypto however this is so much more difficult to chart, because we are still unsure of so many of the variables that impact pricing of crypto coins. Given this, it is a far smarter move to simply invest and then forget about what is happening with the daily price. Unless you are absolutely confident in your ability to trade, having diamond hands is the smartest decision.
The reason why diamond hands is discussed so much is because so many people act on FOMO or ‘fear of missing out’. This is what drives them to sell low and buy high. Sadly however those who invest in this way only end up losing money rather than making it. This again is why people simply tell you to hold on to your investment, rather than seeking ways of trading it and attempting to turn it into more.
Ultimately the time to sell your investment will depend on what exactly you are looking to achieve from your money. Some can afford to hold this long term and it would appear that they are the people who will make it big over that kind of time frame.