2021-10-11 12:27 |
Risk management is a crucial part of any investment portfolio. It is the process of identifying, analyzing, and insulating investments against uncertain market occurrences. Risk mitigation is even more essential in a cryptocurrency investment portfolio because of the volatility associated with this investment class.
Warren Buffet, the king of value investing, cautions all investors using his famous rule – do not lose money. However, this rule is not as simple to follow in real-life investment scenarios. The crypto space is flush with several pitfalls such as investment blackholes, and significant price movements that put investor funds at significant risk.
This article looks at Dohrnii, a novel blockchain project that aims to educate crypto investors about the fundamentals of the market, improve their returns, and eventually grow their portfolios.
Importance of risk management for an investment portfolioMost crypto investors lose money because of a lack of proper risk management strategies and lack of access to the crucial real-time information that dictates cryptocurrency trends. So, how can Dohrnii’s platform help with this problem?
The crypto space is rife with life-changing opportunities. It is its primary allure, and at the same time, its most significant risk. By offering a platform that allows crypto enthusiasts to learn and invest on the go, Dohrnii hopes to revolutionize the space and level the field for all investors.
Dohrnii provides big data-synthesized investment information to investors using complex AI-based algorithms. This synthesized information exponentially increases the investor’s chances of making successful trades.
For instance, imagine having access to tools that can automatically execute trades based on trigger events, and that is highly customisable so that anyone can adapt and optimise them based on their strategy. These tools could help investors mitigate certain types of risk, such as some black swan events, or market sell-offs.
Risk Management – How Dohrnii helps investors mitigate certain risks.The average investor is usually unprepared for big volatile movements, such as the ones we see in the crypto space. A tweet from Elon Musk, a whale selling a big portion of their holdings in a small-cap coin, a regulatory crackdown… each of these could have a dramatic effect on the market, but yet very few investors have a protection mechanism. The Dohrnii platform allows investors to use a no-code tool to customise and automate trading strategies, using trigger events that will independently take actions on behalf of the investor when certain conditions are met.
What makes the platform even more special is the ability for an investor to share his strategy with other users. The investor that created the strategy will use the Dohrnii smart contract feature to include his strategy in a smart contract and allow other users to have access and lock their funds into the strategy. This enables the user that created the strategy to maintain ownership and monetise it, while freely and safely distributing it to users that want to consume this information.
ConclusionRisk mitigation is crucial for any successful crypto investor. The process usually requires the investor to analyze huge chunks of data to make informed decisions while employing proper risk mitigation strategies. Dohrnii simplifies this process, ensuring they have a risk level that suits their profile and trading personality.
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