thetradingparrot
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Last 2 months crypto report: holdings and bots
🕑 Added 2021-01-06 20:01:02 +0000 UTCI thought it would be beneficial for all people new into crypto and bots to have an idea of how things have been going in the last 2 months for me. Please don't read it as "guaranteed forecast" as all past performances are not guaranteed in any investment strategy but it can certainly give you some idea of what ranges to expect.
There's been loads of downs and ups so I'm going to focus on the big events and some learnings.
On November 6th I had just above £12K invested (1 GBP = 1.36 USD). Since then I've done 4 new deposits (marked in green in the spreadsheet) totalling £18K
I was using 11K for bots and 1K for crypto portfolio. Pretty risky!
Bots were setup very aggressive using different mutations of QFL/ CQS and top daily coins etc. (as you probably know from my 4K video). The conditions where great for alt coins but on the 26th of November a big shake off in the market caused some big losses. From £6K in profit it went down to £2K profit. This was pretty annoying as I kind of decided to ignore a bear signal the day before that was telling me to stop the bots. (See the top cell marked in red in the spreadsheet, from 17% to 3% P/L drop)
Those bots where too heavily invested in alts and shitty coins, which can give amazing returns in season, but any shake off in the market and it can get pretty scary.
Based on the new market conditions: BTC taking over, and alt coins stepping back, I decided to both move capital into the portfolio, particularly into all the coins that tend to mirror whatever BTC does. This was a great call and has been crucial for taking advantage of the new conditions and also to help reducing the risks. Currently there's 40% allocation in bots and 60% in long term holdings.
The second big event was the XRP delisting and lawsuit event in December 2020. Not because I was holding that much XRP but the overall market got a punch in the face. Most coins were down or some bots hit SL. There was a lot of manual intervention needed, adding funds to close deals sooner, etc. Setting up a short bot was a great call. Swapping XRP for ADA too. (see the bottom cell marked in red in the spreadsheet, from 29% to 9% P/L). I could have managed this situation better. Unfortunately I thought that stopping all bots during the early news was going to be an overreaction, after all you hear one conspiracy theory every day. When I heard it from the big crypto influencers it was already in deployment and a bit late to prepare a plan. The "late plan" worked pretty well as most of the fluctuation in the chart recovered incredibly well though.
As you can see in the image the recovery has been fantastic. November started with 6% profit and now its 34% which makes it 28% P/L. This in GBP is £6K and in USD $8.1K or $4K a month.
So not much surprise, big rewards don't come without any risks. Of course there are higher reward options in crypto. You can do Futures and Margin trading, you can do 150x leverage with some exchanges. But I'm ok with this level of risk and I think 28% in two months is a great pace.
If we keep this pace and if we use compound interest we can turn £20K into £100K in a year time. Using compound would mean we put all the capital at risk. In my case I would probably be looking to move larger profits into safer buckets like stocks or stable coins once we see big gains once again. Of course this may underperform compared to the compound interest scenario but if you see the past market shakes, I don't think I will survive with 10 times the funds invested.
