Shruti Sinha

Statistics show that crime rates reflect an upward graph in 2023. For example, in the first half of 2022, approximately 236.1 million ransomware attacks were reported worldwide. While many crimes are considered in that graph, the one that accounts for the majority is cybercrime, in 2022 alone, investment fraud was the costliest form of cybercrime, with an average loss of $70,811 per victim. And digital currency is proving to be essential in combating cybercrime as the first line of defense.   Despite such frauds, digital currency has taken over the banking and financial sectors. Today, Bitcoin, Ethereum, Polygon, and Terra 2.0 are just a few of the popular names reigning in the world of digital currency and investors from a diverse age demographic are actively taking part in digital currency trading.  This blog will discuss digital currency and digital currency trading at length, going through its meaning, advantages, disadvantages, and other important segments.   What is Digital Currency Trading, and How to get Started?   Digital currency is a currency that is exclusively digital, decentralized, and secure. In recent years, digital currency trading has become increasingly popular, with more and more people interested in investing in this new type of asset. If you’re new to digital currency trading, you should know a few things to get started.   Something that separates digital currency from electronic money is that the former cannot be liquidated. However, the latter could be withdrawn from an ATM at any time.     The first thing to understand is that digital currency trading is similar to traditional stock trading. Just as with stocks, digital currencies are bought and sold on exchanges. These exchanges allow you to trade your digital currencies for other digital currencies and traditional fiat currencies like the US dollar.   The next step is choosing your stock. When selecting an exchange, it’s essential to do your research to find one that is reputable and trustworthy. Look for a deal with a good track record, is regulated by a respected authority, and has robust security measures to protect your assets.   You can buy digital currencies with traditional fiat currencies or trade other digital currencies. Once you’ve chosen an exchange, you need to set up an account and fund it with the digital currencies you want to trade. Be sure to pay attention to the exchange rates and fees associated with each transaction to ensure you’re getting the best deal.   Once you are done with the account setup and funding, you can start trading. Digital currency trading is a highly volatile market, so staying informed and keeping up with the latest news and trends is essential. This can help you make informed trading decisions and avoid significant losses.   Given the basics are in place, you should keep the following pointers in mind while trading in digital currency:   Have a strategy in place when trading digital currencies  Keep yourself updated on the latest trends, news, and trading methods.  Diversify your portfolio  Setting stop-loss orders to limit your losses  Do not put all your eggs in one basket  Trade only if you want to, not because you feel pressured  Avoid putting your life savings into trading  Stay disciplined with your trading strategy  Having said that, Digital Currency Trading is a double-edged sword. Investors must be familiar with the pros & cons of trading in digital currencies.   Pros   Quicker payments: Digital currencies allow payments to be completed much faster than current methods, such as ACH and wire transfers, which can take days for financial institutions to confirm transactions.   Cheaper international money transfers: International currency transactions are costly. Especially when it comes to currency conversion, individuals are charged high fees when transferring funds from one country to another. Digital assets can disrupt this market by making it faster and cheaper.   24/7 access: Existing transfers often take longer on weekends or outside regular business hours when banks are closed and cannot confirm transactions. In digital currency, trading occurs 24 hours a day, 7 days a week, at the same rate.   Well-structured government payments: If the government developed its Central Bank Digital Currency (CBDC), it could instantly send people payments for tax refunds, child support, food stamps, etc., instead of mailing checks or finding prepaid debit cards.    Cons   Too many options: The current popularity of digital currencies has a downside. So many digital currencies are being created on different blockchains, each with limitations, that it takes time to decide which is the best.   Steep learning curve: Digital currencies require work on the part of users to learn how to perform basic tasks such as learning to open your digital wallet and storing your digital assets securely and adequately. The system needs to be simpler for digital currencies to become widely accepted.   Price fluctuation: Cryptocurrency prices and values can change suddenly. However, CBDC’s value is much more stable than in fiat currency and does not fluctuate as much.    Bottom Line   In conclusion, digital currency trading is a potentially lucrative investment method. However, it’s vital to research, choose a reputable exchange, stay informed, and have a solid trading strategy. While digital currency trading can be highly profitable, it’s important to remember that it’s also speculative. Always invest only what you can afford to lose, and never invest more than you’re comfortable with. Following these tips can increase your scope of success and minimize risk in this exciting new market.   

Fear, lack of knowledge, and insufficient funds.    As astonishing as it may sound, the problem is real. They may seem like issues faced by teenagers, but these are, in fact, problems faced by potential and new investors. And if you are here looking for solutions, I promise, you won’t be disappointed. This blog highlights how you can fully utilize your hard-earned money without confusion. The two most popular investment options – ETFs and Mutual Funds, are discussed at length here to give an idea about what suits you and your pockets.   Wait.  If those two terms didn’t ring a bell for you. If you still believe that locking your money and forgetting about it for a fixed time is a good idea. Then, my friend, you need to know why investing is essential.   Investing your money in Fixed Deposits was good when we didn’t have options like today. Not only do we have enough opportunities to invest our money, but plenty of options do not require hefty amounts. Investing is no longer a rich person’s business. If you look at it closely, money is like our brain. You need to put it to good use to make the most of it. And making the best use of your savings is to invest it.    Let’s see how you can multiply your money by investing in ETFs and Mutual Funds.   ETFs   An Exchange Traded Fund (ETF) is a type of pooled investment security that functions similarly to a mutual fund. ETFs typically track a specific index, sector, commodity, or asset. ETF can be bought and sold on an exchange like regular stocks. ETFs can be configured to track anything from the price of a single commodity to a sizable and diverse collection of securities. ETFs can also be structured to follow definitive investment strategies.   While ETFs give you access to many stocks across various sectors, there is a higher fee for actively managed ETFs. Another disadvantage is the need for liquidation that hinders transactions. If you have an ETF focused on industry, it will also limit your scope diversification.   Mutual Funds   ‘Mutual funds are subject to market risks’ is something that everybody is familiar with; still, most of us need to learn what precisely mutual funds are and how they are risky.    A mutual fund is an investment platform that raises money from multiple investors and invests those funds in various financial assets such as bonds, stocks, stocks money market instruments, and gold.    Mutual funds are managed by investment professionals who allocate these funds to generate income for the investor and gains on his capital. Small or individual investors can access professionally managed stocks, bonds, and other securities through mutual funds. As a result of which, each shareholder participates equally in the fund’s gains or losses.   Simple, right? So, where’s the risk?    Mutual funds are tricky because there are no guaranteed returns. It all depends on the market behavior. You could lose money as these kinds of investments are volatile, and there are daily price fluctuations. Along with this, it could also be affected by any event in the stock.   What is the best choice for you?     Choose ETFs if:   You are an active trader, and your choices are intra-day trades, top orders, options, and short telling.    You are tax-sensitive. ETFs are generally more tax efficient, allowing the investor to keep more of the money they make.  Choose Mutual Funds if:   You invest at frequent intervals (like monthly). Mutual funds are reliable that way; every month, you can pot a fixed amount of money and be done with it.   You have high hopes that the stock will surpass the benchmarks and want to do less with the market volatility.   Conclusion   Investors have a wide range of choices, and deciding whether to go for a mutual fund or an exchange-traded fund (ETF) may seem trivial compared to all others, but they have crucial differences. Both mutual funds and ETFs hold portfolios of stocks and bonds, sometimes more exotic such as precious metals and commodities. They must adhere to the same rules about what they can own, how much they can concentrate on one or several holdings, how much money they can borrow relative to the size of their portfolio, etc. Beyond these elements, the path diverges. Some differences may be subtle, but these differences may make one type of fund or another more suitable for your needs.   While there is risk in everything we do, making a start is crucial. Similarly, whatever you decide to go forward with ETFs or Mutual Funds, it is vital that you start investing your money to gain the benefits. The key here is to only invest the principal amount you are okay with letting go of. Anyone can be a good investor by keeping a few simple things in mind, like, not putting all the eggs in a single basket, ensuring that you have an emergency fund, and evaluating your comfort with taking risks.    This quote by Shelby M.C. Davis answers many questions from investors, and it is best to conclude the article with this, “Invest for the long haul. Don’t get too greedy, and don’t get too scared.”   

Life is all about taking chances and growing. But when you are making an investment, and your money is at risk, making a mistake could cost you fortunes. The pandemic gave many individuals ‘free time’ to start investing or at least the time to dive into the deep sea of being an investor. While social media sites like Youtube and Instagram were flooded with posts and videos encouraging people to start trading stocks, and tips and tricks on how to do it, some common pitfalls could have been avoided. If you are someone looking to invest the green bills but are scared of losing some, continue reading as this article talks about the ten mistakes you could avoid as an investor.  Expecting too much For people just getting into investing, penny stocks could be a way to earn big sums. But there are huge risks involved in these as you set up high expectations from these small stalks and when they underperform, you turn out to be disappointed. Having a clear picture before putting in your money is what will help you avoid this pitfall. Another way of avoiding risk is being aware of the historical trends of the stock you are trying to invest in.  Being Impatient  Another investment mistake is a lack of patience. If you are investing for the long term, stocks may not produce the returns you want right away. When a company’s management announces a new strategy, it can take months or years for the new approach to take hold. All too often, investors expect the stock to act in their best interests immediately after they buy it. Experts recommend that if you want to enjoy the retirement you probably should start investing while you’re still young.   Not Researching Enough  Failure to do proper research when investing can be a costly mistake. Venture capitalists and mutual funds regularly conduct due diligence to ensure that their investments are worthwhile. As a general rule, the more due diligence you have, the better your investment results. If you check out the company with all the warning signs and potential risks included, you are much less likely to be shocked by any sudden events.  Using the money you don’t have  Investing money you can’t afford to risk can increase your emotional and stress levels, leading to poor and impulsive investment decisions. Considering your risk appetite when evaluating stocks is of key importance. And the willingness to lose part or all of the original investment in exchange for a higher return needs to be there because the future is unknown. Ensure that you evaluate which stocks or asset classes you feel comfortable with when determining your risk tolerance. Don’t invest money you can’t afford to lose like your rent or emergency savings. Not Diversifying enough For rookie investors, one of the biggest mistakes that they could make is investing in a few concentrated positions. While this may be good for professional investors, for others it is always beneficial in going down the line of diversification. The general rule of thumb to follow here is to not allocate more than 5% to 10% to any single stock.  Waiting to break even  Waiting to get even just shows that you lack the guts to let go of your comfort zone. If you think this doesn’t make sense, then consider this: by not selling a sinking stock you lose in two major ways. First, you forego any opportunity to invest that money in profitable stocks. Second, you don’t know how long the ship will continue sinking. Not understanding the company  Warren Buffet warns investors against investing in companies whose models are difficult to understand. More often than not, we fall in love with the company’s reputation, and forget that the company’s fundamentals have to align with our requirements and not vice-versa. Avoid investing in business models that do not make sense to you, and try building a portfolio of EFTs or mutual funds.  Giving an upper hand to your emotions   While it is a fact that for a majority of investors fear and greed rule the market, the focus should always be on the bigger picture. A short time frame generally means unstable returns and for an investor who puts the heart into this instead of the mind, it is going to be frustrating.  Following the herd  Following the crowd is another investment mistake because it doesn’t involve research and instead reflects what other investors are doing. Most people only hear about investments when they are already doing well. When the price of a particular stock doubles or triples, the mainstream media tends to treat those moves as hot takes. Unfortunately, by the time the media gets the attention, the stock may have peaked. At this point, your investment may be overvalued. Still, TV, newspapers, and the Internet can exaggerate stock prices. Late investors will probably always lose the money as the profits will already be made.    Not Investing  The worst mistake anybody could make is the mistake of not investing at all. Agreed, that it gives the benefit of not risking any of your hard-earned money, but the thing that most people forget to notice is that, it also takes away any opportunity for you to get returns on that money. While it is given that in the initial times, the returns are going to be low, this should not stop you from investing.  Bottom Line  By keeping in mind, the aforementioned points, new and budding investors could explore the world of trading stocks. Multiple resources available can help one become a better investor if only one is mindful enough to take help from trustworthy resources. Keep in mind, money saved is money earned, and money invested is money multiplied. So, go ahead and invest your money cautiously as successful investing is all about managing risk, and not avoiding it.