Hi, and welcome to my first real article!
I have seen many traders say they "outperformed" the market by trading, and made so much money off of futures trading that they saw no reason to HODL.
So I thought to myself: Why don't I find out about this? Why don't I investigate it?
So I decided to place $100 down for the "experiment". I'm not rich whatsoever, so $100 is a lot to me.
But the way I saw it, if I could come out with a profit, that would be great. And if I lost more than 5% in any of the ventures (Trading or HODLing), I would pull my money out instantly.
That was the plan.
Now for the asset of choice.
I knew that DeFi coins would be the best bet for this kind of experiment. So I decided to go with $LINK.
$LINK is a fundamentally great coin, and one that I enjoyed owning last year. I was able to pay my rent just by holding LINK!
Buying and HODLing LINK was not much of a problem for me, since I have already done it before!
Now for trading. I'm no technical expert, but I know the basic rules of technical analysis, and at least have developed a somewhat profitable strategy. So I at least know my way around trading.
Here's a chart showing where I did every thing
As you can see, my HODLing balance is up almost 100%, which is insane because it was just a random decision to buy.
My trading account however is completely destroyed.
I had the idea of using 2x leverage to trade LINK. Here's how that turned out:
Maybe I'm a bad trader? Maybe the conditions were bad? Maybe the market was wrong?
Any and all of these may be true. However, point remains that I lost money trading, and made money HODLing.
Unless you have some kind of crystal ball or a serious edge over the market due to years and years of trading, you just can't beat hodling strong assets. Trust me.
Just look at LINK from the beginning. You know how many times a day you need to trade to beat that?
My verdict?
HODL guys! Just HODL!
Thanks for reading my first post here on LeoFinance! I have a lot more to write over the coming days, so kindly follow me for more content!
Also, if you have any comments, please leave them in the comments section. I will definitely answer every single one of them.
Thanks for reading!
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Hi Mad Max. What a great way to experiment. I like the scientific approach of splitting the money 50:50 and hodl'ing one whilst trading the other.
I think the issue with Hodl'ing though is that to "extract" any value from your gains, you have to reduce the amount of coin you own. With trading, hopefully you end up with more coin (and can "extract" the profit, keeping the seed money in to do more trading).
I use both approaches. Currently split 60% Hodl, and 40% trading.
Good Luck! :-)
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Yeah that's why HODLing sucks. You need to sell to get the extra value, but pick your demon I guess :)
Trading is a lot riskier and entails more "speculation". But HODLing fundamentally strong assets is a surefire way to win.
Thanks for stopping by!
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