While nobody can make the best investment decision every single time, following these golden rules could help you to get more from your investments over the long term.

1. If you can’t afford to invest yet, don’t It’s true that starting to invest early can give your investments more time to grow over the long term. However, it’s important not to begin investing until you can truly afford to.

Here are some steps to take to get your day-to-day money matters sorted before you begin investing.

Keep some money in an emergency fund with instant access Having some money that you can get your hands on quickly could help you cope with life’s ups and downs, without needing to dip into your investments.

Clear any debts you have, and never invest using a credit card Interest and charges can mount up fast if the balance isn’t paid off, and are likely to exceed any investment returns that you make.

The earlier you get day-to-day money in order, the sooner you can think about investing This will allow you to work out what you can afford to invest. Getting your everyday money matters sorted also gives you more opportunity to invest regularly, increasing your chances of meeting your goals. To find out whether you’re ready to begin investing, read our should you invest article.

1. Set your investment expectations Before you begin to invest, think about what returns you’re realistically expecting and be clear on what your investment goals are.

The greater the potential returns, the higher the level of risk Make sure you understand the risks and are willing and able to accept them.

Different investments have different levels of risk. It’s important to think about how comfortable you are with the value of your investment going up and down while you’re holding it. You should also think about whether you’d be able to cope financially if your investment made a loss.

While most investors like the idea of high returns, they often come with an increased risk of losing your money. With high-risk investments, you should be prepared to lose all of your money.

Read more about how to balance risk and returns.

Target a realistic rate of return in the context of other available investments Risks vary widely across investment markets and products, and returns can be very difficult to forecast. So be wary of products that raise expectations of unrealistic returns – these could come with risks you’re not willing or able to take.

And remember, if it sounds too good to be true then it could be a scam. Visit ScamSmart to find out how to protect yourself against investment scams.

Don’t forget your charges You should be prepared to pay an investment provider charges/fees for their services. However, these can mount up over time, eating into your investment returns. So it’s important to compare costs and make sure you’re not paying for any services that you don’t want or need.

1. Understand your investment Make sure you understand what you’re actually investing in before you hand over your hard-earned money. Your future finances are linked to how your investments perform so it’s important you know the key information before you invest.

Make sure you know things like the level of risk you’re taking, the factors that might affect how your investment performs and how easy it is to get your money out when you need to. Before you invest, take time to do some research of your own – and never invest in a rush or in anything you don’t fully understand.

Some investments are professionally managed and can help you to align your long-term investment goals. For more information on these types of mainstream investment options, read about the advantages of mainstream investments.

It’s important to check whether the firm you are dealing with is authorised by us to provide the service or product you are buying. You can check whether the firm is authorised using the Financial Services Register.

But remember – just because a firm is authorised, it does not mean everything they do and sell is regulated. You may not be protected, and you may not receive compensation from the FSCS or FOS, if you use the services of a firm that is not authorised to provide them and things go wrong.

1. Diversify In an uncertain world, putting all your investment eggs in the same basket can be risky.

Spreading your money across a range of different companies, asset types and geographical areas will reduce your reliance on any one to perform. So if some of your investments perform poorly and make a loss, your other investments might not. Therefore, many people choose to invest in a fund – where an investment manager will choose which assets to invest in on your behalf.

Find out how spreading risks through diversification can help you become a smarter investor.

1. Take a long-term view Investing should not be viewed as a short-term solution to a problem. Investing over a timeframe of at least five years can give your investment more opportunity to ride out any short-term performance dips.

Look beyond the short-term The factors that drive the day-to-day moves in markets are notoriously difficult to predict. Even over a matter of weeks or sometimes months investment returns can be erratic. Trying to time the market increases your risk of buying or selling at the wrong time. By investing over a longer timeframe, you’re more likely to benefit from trends that can support positive performance over a matter of years.

Investing monthly over five or more years can smooth out returns While some may have a lump sum to invest immediately, others invest regular sums on a monthly basis over several years. This can help to even out the effect of short-term market moves as a regular monthly investment buys more during months when prices have dipped, and buys less when prices are higher.

Think about how to access your money if the unexpected happens Ideally, you won’t need to touch your money for at least five years. But life can sometimes take an unexpected turn. A change of personal circumstances, perhaps due to a career change or illness, could mean that you need access to your money urgently. So check for any notice periods or fees that you’d need to pay just in case.

Even when investing in the long term you should still make sure you are comfortable with what you are investing in and the risk that you could still end up with less than you put in.

1. Keep on top of your investments It's a good idea to periodically review the performance of your investments. Choices that were right for you two years ago may not necessarily be the best for you now. Whether you speak to an independent financial adviser or conduct your own review, it makes sense to reassess your investment choices regularly.

Take stock of your investment performance Some investments you hold will almost certainly have performed better than others, so the attractiveness of some over others may change over time. As higher risk is by no means a guarantee of higher returns, reviewing what you hold can also help you keep on top of the overall level of risk you’re exposing your money to.

Your immediate personal circumstances may have changed Your investment choices depend on many factors, some of which may be unique to your own circumstances. For example, if a new job brings a higher income you might have more money to invest each month, and you may be more prepared to take more risks with, in the hope of higher potential returns. Regularly reviewing how and where you’re investing can help to ensure your investments still suit your personal circumstances.

Your investment objectives evolve over time Whether you’re trying to build up investments for a particular life event – like funding a major career change – or maximising your pension fund, what you’re looking to achieve with your investments can change over the years.

There is no win-win situation Think back to the seesaw on the schoolyard. Two children rock up and down. There are two states. Either one child is up and the other is down. Or they balance themselves in the middle under a lot of strain. That’s how trading works. Sometimes nothing happens and the courses balance in the middle under a lot of strain. However, every time a trader makes a profit, a different trader takes a loss. The seesaw cannot be up on both sides. Simple physics. The question is: Why do you think you’re better than your counterpart?

2. Trading is war In organised battles between nations, there is the term “fog of war”. The general can’t see the entire battlefield but only what’s in front of him. He has to make decisions with incomplete information. It’s the same with trading. Some traders are always on the wrong side of the asymmetry. There are so-called whales — they own so much crypto that they can strongly affect the course with a trade. However, only the whale knows when he will make the trade. If a (real or fake) message drives the price, then we usually find out about it too late. The winners in trading are those that have the significant information before the others do.

50 plus 1 Once again the seesaw. There are only two relevant states a course can have: rising or falling. It’s a matter of 50:50. If we let a monkey trade, then the probability of it being right is exactly 50%. Nobody is 100% right. There is no system that can always predict an irrational and repeatedly manipulated market correctly. The goal of every trader is to be right at least 51% of the time. Every trader needs a frustration tolerance for losing money in 49 out of 100 trades.

Unfortunately, faith is everything No matter how mathematical the system is, our belief in magic and faith keeps getting in our way. Example: A coin is currently being pumped and reaches dizzying heights. We know that it’s generally too late to get in already, but we still do it out of fear of missing out (FOMO). Or we see patterns where there aren’t any. In psychology, there is a separate research field for this: Bias. The result: Nobody is rational. Believing that we act rationally in the market is a mistake.

1. You are the mistake The market is always right. If the market doesn’t behave the way you thought it would, then you’re wrong. Always and forever. Amen.

2. The 80/20 rule of trading The good traders make their money with 20% of their trades. The rest is either a tie or a loss. If a good trade brings a profit of 16%, then a bad one may bring an average loss of 4%. You can reach this relationship with a stop-loss. In this way, you can also calculate whether you make a net profit. And you see that a trade with 3% profit isn’t really a win.

3. Beginners lose at trading because they: bet too much money trade without knowledge, so they’re basically playing the lottery hold positions for too long trade with cheap shitcoins gamble with other people’s money never cash out their winnings trade too often, therefore also trying out mediocre trades

Invest in what you understand Inform yourself before you buy a coin. What are they doing? Does it make sense? Or is it at least understandable? The better the product, the more likely it is that the course will go up in the long term. This advice basically also states that you shouldn’t trade shitcoins.

1. The differences between crypto and other markets Crypto markets don’t sleep, they are open 24/7. The cycles between euphoria and depression are shorter by a factor of X, crypto trading happens in warp speed. If a stock market is “bearish”, then it can take a break for a few weeks or months. In crypto, next week everything will be different. Volatility — meaning course fluctuations — of 30% per day are almost normal and up to 100% (flash crash of Ether in 2017) aren’t impossible. You have to have the stomach for this. Traditional media for instance are too slow for crypto. If the article says that Bitcoin is down 30%, then the situation will have already changed by the time the author publishes it on his website. Stock traders thing in %. Crypto traders think in x (in form of a x-fold increase or decrease). Illegal actions like insider trading are happening everywhere. However, in the unregulated crypto space, it’s happening more frequently and the effects are bigger. An advantage in knowledge is even more profitable in crypto. Herd mentality. Technical course analyses can work well in the crypto space because the market is small and there are many participants doing analytics. If many people trade based on the same results, then prognoses become true. You shouldn’t make big purchases or sales outside of the top 20 (bigger than 1,000 euros). Lower trade volume worsens the price between the first and the last euro.

2. Make 100 bad trades quickly The only way to increase the probability for winning is real experience in trading. Reading books won’t help you. Neither will trading with play money. Only real trading with real money will bring experience, insight and success (if anything will). Start small. Start with 100 euros. Once they have doubled, add another 200 euros. Once these 400 have doubled, repeat. Only trade with sums that won’t make you nervous. Being nervous is bad for business.

3. Less technical analysis (TA) is more Learn about: Moving averages, stochastic RSI, trend lines, the basics of the Candle Sticks, upwards & downwards channels, bull flags, breakouts and wedges. You can “zoom” TA, you can form them from daily, hourly or minutely values. The shorter the timeframe, the more error-prone the pattern. Don’t search in minutes what you cannot discover in hours.

Emotions are not your friend.

It’s all too easy to get caught up in the rush and excitement of a winning trade streak; or conversely, the depression of a losing trade streak. In both cases, the end result is the same far more often than not — sloppy trading, which ultimately results in loss.

Like a UFC fighter who’s trained hard to become the athlete they are, emotionally-detached discipline and focus is the key to becoming a successful Crypto Trader with regard to Golden Rules #2, 3 & 6.

The best trading strategy in the world will still lose you money until you get this right.

Simply put, if you loose 3 trades in a row, time to back off for awhile and “regroup”. Conversely, if you win multiple trades in a row, don’t get cocky, as this will inevitably lead to ruin.

So stay humble, stay lean, and check your emotions in at the door. They’ll still be there waiting for you at the end of your trading session.

Diversification is essential for successful trading Diversification is one of the most important tenets of successful investing, and that principle applies just as much to trading cryptocurrencies. By spreading your investments across multiple assets, you can mitigate the risks associated with putting all your eggs in one basket.

Not only that, but diversification can also lead to greater profits. By carefully selecting a mix of assets, you can maximize your chances of achieving your desired trading results.

So if you’re serious about trading cryptocurrencies, remember to diversify your investments. It’s one of the smartest things you can do to protect and grow your portfolio.

Only invest what you can afford to lose Cryptocurrencies are a risky investment, but there are potential rewards for those who take the plunge. If you’re thinking about investing in crypto, it’s important to only invest what you can afford to lose. This may seem like common sense, but it’s important to remember that the crypto market is highly volatile and can swing up or down suddenly.

Of course, there’s no guaranteeing that you’ll make money by investing in crypto. But if you’re careful and only invest what you can afford to lose, you’ll be in a better position to weather the ups and downs of the market.

Don’t let your emotions take control As the crypto market is highly volatile, it’s important to not let your emotions take control when making investment decisions. It can be tempting to sell when the market is crashing or to buy when prices are skyrocketing, but it’s important to remember that these fluctuations are normal and to stay the course with your investment strategy.

It can be difficult to stay calm when the market is in a state of flux, but remember that panicking will only lead to bad decisions. So take a deep breath, step back, and assess the situation objectively before making any moves.

Be aware of scam schemes When investing in cryptocurrency, it’s important to be aware of scam schemes that can defraud you of your hard-earned money. While there are many legitimate investment opportunities in the crypto space, there are also a number of scams that you should be aware of.

Ponzi schemes, for instance, are a type of fraud where money from new investors is used to pay back earlier investors, giving the appearance of a profitable investment. But eventually, the scheme will collapse when there’s not enough money to pay back everyone.

Use a stop-loss If you’re thinking about investing in cryptocurrency, one of the first things you should do is set up a stop-loss. A stop-loss is an order you can place with a cryptocurrency exchange that automatically sells your coins when they reach a certain price. This is a useful tool for investors because it helps you limit your losses if the value of a coin goes down.

There are a few things to keep in mind when setting up a stop-loss. First, you’ll need to decide what price you want to sell at. Second, you’ll need to find a exchanges that offer stop-loss orders. And finally, you’ll need to understand the fees associated with stop-loss orders.

With all that in mind, let’s take a look at how to set up a stop-loss order on a popular cryptocurrency exchange.