Asset allocation is an investment strategy that involves dividing your investements among assets such as stocks, cryptos, etfs, houses, etc.
How can we use Asset Allocation on the CryptoMarkets?
Well we can split our money to different cryptos depending on their functions. Personally I find Solana (SOL) and Ethereum (ETH) like the tech-stocks. They do pretty well in the bullruns, and almost always are a bit overvalued but that's due to the future expectations. I always have some on my wallet.
Bitcoin (BTC) is the no.1 crypto and most probably is gonna stay like that for a while. With only a limited supply and being the first out there, is without a doubt, the digital gold. We might not see Bitcoin (BTC) make a 20x in a day like the low market cap coins but it is the crypto that moves the market and that brings a lot of stability in your wallet. We can also have a place in our wallet for even more futuristic purposes, such as metaverse coins like Decentraland (MANA) or The Sandbox (SAND), web 3.0 cryptos like Helium (HNT) and some Internet of Things cryptos like IOTA (MIOTA) or Chainlink (LINK). It all depends on how you want to manage your portfolio, how you wanna invest, how much is your risk tolerance. We can even have a small percentage of Meme coins like Dogecoin (DOGE) or Shiba Inu (SHIB), for that 10x, because who knows maybe Elon Musk will Tweet something.
Conclusion
It's better not to go all-in in one crypto, because the cryptomarket is super volatile. Set your risk tolerance, your risk-reward ratio, so you wont be dissapointed If the market goes down 50% for example. Invest only what you can afford to lose.
This post is not a financial advice.
