When investing in standard markets, such as the stock market, it’s typical to see them fluctuate by 1% or 2% on a daily basis. In the cryptocurrency market, on the other hand, you wouldn’t be surprised to see price variations higher than 10% in a single day.
Because of that, cryptocurrencies can be an option to diversify your investment portfolio, acting as a plan B for your traditional assets. However, cryptos aren’t usually recommended for people who are investing short-term.
Cryptocurrencies are a risky asset class, which should be carefully researched and evaluated by anyone thinking about purchasing a particular cryptocurrency. Please remember that diversification is not an investment strategy without risk, and in certain circumstances, it may not fit your investment objectives.
Cryptocurrencies can be an interesting option when it comes to portfolio diversification, and their value may increase significantly as more people begin to use them as a cheaper and faster way of exchanging money.