Few financial markets can rival the crypto market’s potential for astronomical gains as well as dramatic volatility. Cryptocurrency is its own animal and should be treated accordingly. However, trading is still trading.

At its core, the principles and strategy behind effective trading and investing remain the same in any financial market. Over the years, traders have found themselves in the same positions over and over again. Yes, markets are unpredictable – but certain cycles & situations have a tendency to repeat over time.

For decades, certain nuggets of trading wisdom have remained relevant across various financial markets. Many traders refer to these sayings and mantras as general guidelines, especially during periods of market volatility. While they do not guarantee success, they may provide helpful insights for those navigating the crypto space.

Here we have some of the most famous and enduring trading sayings of all time. They’ve worked for traditional investors and can be very useful for both new and experienced crypto traders too.  If stuck to, and only broken when the situation demands it, these trading sayings have been used by investors in various markets and may provide insights for those navigating the crypto space. Enjoy!

It’s about time in the markets, not timing the markets

Consistently timing the market so you can buy/sell at the ideal moment and take advantage of every market movement is every trader’s dream. But it’s a high-risk-high-reward approach and is much easier said than done.

While it is useful to have some basic strategies about how to time the market (buy low sell high is a common one), this trading adage suggests that these efforts of timing the market are not as important as the time you spend in the market. Many crypto investors choose a long-term holding strategy, believing it aligns with their goals.

Some traders incorporate long-term investments into their portfolios, and crypto investors may choose to do the same based on their individual goals.

While it is a perfectly legitimate strategy to trade frequently to maximise short term gains and capitalise on daily/weekly market movements, many crypto investors are choosing to hold the majority of their portfolios, believing that their assets will be worth a lot more years down the track.

Some large Bitcoin holders have stated they are in it for the long haul, believing in its long-term utility and potential.

In the words of trading guru, Rayner Teo, ‘Be patient. Once a trade is put on, allow it time to develop and give it time to create the profits you expect.’

Know what you own and know why you own it

This quote from Peter Lynch sums up crypto trading in a nutshell. The success of a cryptocurrency is intrinsically tied to its unique ability to solve a problem in the market or significantly improve on an existing technology.  By researching the utility of a cryptocurrency, as well as the company and community behind it, you can gain a better understanding of how it aligns with your financial objectives.

Understanding the technology behind a cryptocurrency is the best way to know when it is undervalued, overpriced, and ultimately when to buy or sell. In the world of crypto and investing in general, knowledge is power. Check out our other articles on how to evaluate a good cryptocurrency investment and how to do your own research in crypto. 

Don’t marry a position

When it comes to investing, it can be easy to get too attached to your investments. Crypto is no different. If you put in the time and effort to research a coin thoroughly before picking it as one of your winners, you may find it difficult to let it go when it starts to tank.

Maybe you had a hunch about a certain coin and the more you researched its unique potential and the superstar team behind it, the more you became convinced of its inevitable success. In our experience, there is a lot of mental gymnastics naive traders engage in to justify a position.

Some traders prioritise taking profits at specific moments, while others prefer to hold their assets through market cycles. The approach varies based on individual strategies and risk tolerance.

The crypto market is volatile and takes no prisoners. It rewards those who can keep a clear and objective mind while trading. However, while it is important to acknowledge when the market has turned against you, many crypto coins have been known to bounce back after a seemingly apocalyptic crash. Some investors choose to hold after a market dip if they have confidence in the long-term potential of a coin, but market conditions can vary.

How to Assess the Strength of a Crypto Project

When evaluating cryptocurrencies, some traders look at factors like community support, the development team, and the project’s whitepaper to assess potential viability. In a competitive marketplace, for a crypto to succeed, it must serve its function better than any other coin out there. A crypto’s unique ability to solve a problem in the world is what defines whether or not it will succeed in the long-term.

When assessing a potential crypto investment, the key elements to consider are:

• The Utility & Use-case
• The Community
• The Team (developers, advisors, partners)
• Market Cap
• The Website & White Paper
• The Competition
• The Road Map & Vision
• Trading Volume & Liquidity
• Circulating Supply vs Total Supply

For a step-by-step guide on how to research cryptocurrency projects, click here. Taking a comprehensive look at the project, its team, and its long-term viability can help you make informed decisions. You can learn more about performing a fundamental analysis in crypto at Crypto Simple. 

People lie, markets don’t

The crypto space is filled with a lot of people saying a lot of things. Some of it’s legit, but most of it is hot-air. There are now thousands of altcoins on the market and every day sees new and exciting crypto projects enter the market. But this comes at a price. With every novel coin comes a team of people who will be trying to sell you on why their coin is the new Bitcoin or Ethereum (or a combination of both).

With the initial coin offering (ICO) rollout model in crypto, there is always a lot of bragging and grandiose statements made about new coins. But there is no substitute for doing your own research about the coin’s utility, team, community and whitepaper before coming to your own conclusions. Many have learned the hard way that words can’t always be trusted, especially when they aren’t from a reputable source (usually someone with a decent following and a solid track record).

Given that you can never fully trust a person’s opinion, learn to read the market and understand its trends based on past movements and your own knowledge about a certain coin. No matter who the person is and how strongly they feel about a prediction, recognise that they have a bias based on their own emotional attachment to their own worldview and investments.

Additionally, in the crypto space, a public endorsement by a certain person or group of people can have a huge impact on the coin’s market value and it is not uncommon to see hype-filled pump-and-dump schemes inflating the value of a coin before it inevitably drops back down to earth leaving investors stunned and empty-handed. Conducting independent research is crucial before making any financial decisions, as markets can be unpredictable.

Some traders focus less on individual trade outcomes and more on overall portfolio management.

Whether you’re a beginner or a veteran, this quote from George Soros is an important one to remember. Taking losses is an inevitable part of trading. Even some of the best traders are wrong much of the time – what makes them successful is their ability to accept losses and get out of a bad situation before it becomes worse. Some traders adjust their position sizes based on market conditions and their confidence in a particular trade. It is common for successful traders to lose small amounts of money and then occasionally win large amounts – what matters is their overall profit margin.

Too often we see new crypto investors fail to accept that they are prone to making mistakes like everyone else. Doing your research helps but you can never be certain about anything when it comes to investing. Regardless of whether you made a hasty decision or if one of your most valuable assets is tanking, a good trader will acknowledge the situation without too much emotion. Accept it and act accordingly.

Not letting yourself be paralysed by losses and realizing that they are actually part of a wider trading strategy is something all new traders should strive to do. Always endeavour to be as unemotional and objective as possible when deciding when to buy, sell or hold. In the words of Yvan Byeajee, Confidence is not “I will profit on this trade.” Confidence is, “I will be fine if I don’t profit from this trade”. Swallow your pride, don’t personalise your losses, and take calculated risks when the time is right.

Check out our guide on how to avoid the most common beginner mistakes! 

An investment in knowledge pays the best interest

This one is from Benjamin Franklin and is pretty self-explanatory. Knowledge is the best shot you have of being a successful crypto trader. Without solid research and knowledge of a coin and the company behind it, there’s a good chance you’re going to end up worse off than when you started.

The art of profitable crypto trading relies heavily on evaluating the many factors that contribute to a coin’s value and future potential. Warren Buffet advised to ‘never invest in something you don’t understand’, and we’d have to agree. Put in the time before you make the trade. Trading should be the easy part; the hard work is in the preparation.

It is much better to buy a wonderful business at a good price than a good business at a wonderful price

Another quote from investing legend Warren Buffet. This piece of wisdom is especially relevant to crypto and has helped Buffet make some of the best investments of his career. In the crypto market, it is crucial to know exactly what you are investing in. This includes having a solid understanding of the coin’s proposed utility and function, the company and team behind it, and the community who are likely to adopt its use case.

Most cryptos start with little to no value but promise the possibility of astronomical gains that are rarely found in other trading environments. However, following Buffet’s advice, just because a coin can be bought dirt cheap does not mean you should buy it.

Although Buffet and many other investors have bought into some of their best investments while prices were incredibly low, it is important to remember that in the world of crypto, a wonderful coin at a good price is far better than a good coin at a wonderful price. There are thousands of coins on the market and just a small portion of them will actually be around in 5-10 years time.

The intrinsic value and utility of the coin is the most important thing. As we have seen over the years, the vast majority of cryptocurrencies don’t even make it off the ground and fail long before reaching anywhere close to what their founders envisioned. This is why research (and having positions in more stable, established coins) is so important. If a cryptocurrency has strong fundamentals and an active development team, some investors may consider it a more compelling option, regardless of its price.

My attitude is that I always want to be better prepared than someone I’m competing against. The way I prepare myself is by doing my work each night

This quote from Marty Schwartz reminds us that trading, at the end of the day, is a zero-sum game that takes no prisoners. Generally speaking, every gain in the market is balanced by a loss of the same size and vice versa. To put it another way, for every person winning, there is someone losing. Many traders aim to manage risk and maximise their successful trades, but markets can be unpredictable.

Here Schwartz reminds us that there is no easy way to riches – at least not in the long-term. By acknowledging that everyone else is out to win (and probably also thinks they are making great trades), you will realise that the best way to get an edge on the competition is to be better prepared and informed than the rest. While these trading principles have been referenced by many investors, conducting your own research (DYOR), discussing insights with others, and staying informed can help you make more educated decisions.

Final words

We hope you’ve enjoyed these trading insights. Many traders have found value in these principles over time, but it’s important to remember that markets are unpredictable. While research and risk management are key, there are no guarantees when it comes to trading.