How worth is a diversity of investment ?

Hello everyone,

I'm a complete beginner in trading and I would like to invest in various ways in order to limit my losses in general. I'm not looking especially for a short term benefit, I can wait 2 or 3 years, or even more if necessary. For now, I would like to invest a bit in cryptocurrencies. By the way I have a relative good background in mathematics and statistics.

My question is : Since a lot of cryptocurrencies are "created" every year and only some of them will inflate, in how many cryptocurrencies do I have to invest in order to be sure to get a benefit (even if it is not a lot) (on a one year scale) please ? Do you know some theorems, articles, papers, books, videos or authors which answer to this question please ? Some mathematical researchs which weigh the possible benefits, risks, losses in function of the amount of different investments/rates ?

Thank you in advance for you answer !

Have a nice day !

cryptocurrencies are still in the process of getting listed on the major exchanges. i'm not even sure how you'd value them, let alone diversify in them to limit drawdowns. they look more like trading vehicles at the moment. in this environment, if you want to start investing long term, you might want to look at just buying each of the major assets classes in equal amounts, basically precious metals, treasuries, and stocks, ie tlt, gld, spy on the american exchange. start with an initial purchase, dollar cost average on a periodic basis, and buy more on major weakness. don't get anxious. the markets are going up, but they are also not cheap at these levels. build a position over time. investing should actually be boring and systematic.

Olscream said:

My question is : Since a lot of cryptocurrencies are "created" every year and only some of them will inflate, in how many cryptocurrencies do I have to invest in order to be sure to get a benefit (even if it is not a lot) (on a one year scale) please ?

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Quantt said:

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To author: try with any other way for investing. For example, stock market, real estate. Try to be more stable with stable investing instruments. Cryptocurrencies are not a good source for beginning.

Try to invest in a few 3-4 crypto-currencies, but choose not those that were created this year, but those that have been on the market for at least more than a year.

This is actually a good question and addresses the issue of real value.

Cryptocurrencies are a medium for exchange of value.

Lots of new ones are created every year, but few will become widely used.

Some indicators to consider:

1/ Is it a proper cryptocurrency, with blockchain and miner publicly usable?
2/ Does it have an easy-to-use phone app?
3/ Has the app been translated into multiple languages?
4/ Is it widely accepted for payment of goods and services in at least one country?
5/ How many exchanges is it listed on?
6/ Is there a lively public support community or website for it?
7/ How fast is the blockchain growing?
8/ Is the network stable with multiple nodes online?
9/ Do transactions register near instantly and confirm within hours?

& if the answer to any of the above is 'no' then it's a very niche product useful only to it's core members.