Jul 30, 2022
5 Questions to Choose the Right Investment
Determine Which Investment Products Are Best for You
Many products are available on the market when it comes to making investments. It can be challenging to determine which one is right for you. That’s why we’ve put together this handy guide to help you decide which investment products are best for your unique needs. We have five questions to help you make the right decision for your future!
At the end of each chosen answer, there is a value in parentheses. Simply tally up the values at the end of each chosen solution and find the answer key at the bottom of this post with product recommendations. The recommended products are based on the values that were tallied up.
If you have any questions, please feel free to ask on our Discord; we would be happy to help!
#1 Are you a beginner, intermediate or advanced investor?
- Beginner — (1)
- Intermediate — (2)
- Advanced — (3)
Why this matters:
Understanding a user’s educational background and experience in financial markets can help us gauge whether simple or complex investments are better suited for them.
For example, investors who are new to the market may be unfamiliar with certain concepts and strategies and, as such, may be more comfortable with more straightforward products that potentially offer lower levels of volatility. On the other hand, advanced investors who have a good understanding of the market may be interested in more complex products that have the potential to generate higher returns over the long run.
#2 What best describes your risk tolerance when investing in cryptocurrencies?
- Conservative — (1)
- Neutral — (2)
- Aggressive — (3)
Why this matters:
An investor’s risk tolerance tells us their ability to handle the emotional side of investing that comes with drawdowns. Conservative investors seek to chase little drawdowns or take a little risk, while aggressive are willing to take on extra risk. Each side of the risk spectrum should expect different levels of returns, but a user should not go off the expected return.
Taking on more risk may lead to a higher potential return, but it also comes with the potential for more losses. An investor’s risk tolerance should be used as a guide to help make investment decisions, but it is essential to remember that all investments come with some level of risk, and there is no guarantee of success.
#3 What is your investment goal for cryptocurrency?
- Protect my wealth (safety) — (1)
- Consistent, reliable income (income) — (2)
- Maximize my capital growth (capital gains) — (3)
Why this matters:
When working with investments, it is crucial to establish the investment goal. This helps ensure that we match the right products with the right expectations. For example, if investors aim to protect their wealth, we will generally place them with safer investment options. On the other hand, if an investor’s goal is to maximize capital gains, we will put them with investment options that have the potential to perform very well but are also much riskier.
By determining an investment goal up front, we can help ensure that investors are happy with their investment performance and that their expectations are being met.
#4 What is your investment horizon for crypto assets?
- Short-term (< 2 years) — (1)
- Medium-term (2 - 4 Years) — (2)
- Long-term ( > 4 years) — (3)
Why this matters:
When determining an investment horizon, you must consider the time frame you plan to cash out of your investment. Automated investment strategies often experience drawdowns that last several months, so a shorter investment horizon may not be ideal for these more volatile products. If you have a longer investment horizon, you may be recommended more advanced structured products that have proven to outperform the market over several market cycles. By aligning your investment horizon with the timeline for cashing out, you can help ensure a successful investment experience.
#5 What segments of crypto are you interested in?
- Tried and true (Ethereum, Bitcoin, etc.) — (1)
- Up-and-coming (DeFi, NFTs, etc.) — (2)
Why this matters:
Regarding crypto assets, investors can choose from a few different segments. Some tried and true crypto assets, like Bitcoin, have been around for a while and have a proven track record. Then there are newer, riskier crypto assets, like NFTs and DeFi tokens, that are up-and-coming but may be more volatile. So which segment is right for you? That depends on your tolerance for risk and your investment goals.
Our smart-Bitcoin products may be a good fit if you want stability and potential slow and steady growth. However, if you’re willing to take on more risk in pursuing greater potential rewards, then our NFT or DeFi products may be more suitable. Ultimately, it’s up to you to decide what level of risk you’re comfortable with, and we can help you find the products that align with your goals.
Answer Key
When it comes to investing, there is no one-size-fits-all approach. Each investor has its own unique goals and objectives and, as such, will require different products and services. However, most investors can be grouped into three categories: those with shorter investment horizons seeking less advanced products, those with longer investment horizons willing to take on more risk, and those in between.
Each group has different suggested products based on the investor's needs. For example, those with shorter investment horizons may be advised to invest in less volatile products such as our Yield Funds or Buy The Dip tokens. In comparison, those with longer investment horizons may be advised to invest in more aggressive products such as Quantum Momentum or Alpha Portfolio.
Ultimately, it is up to the individual investor to determine which grouping they fall into and what kind of products and services best align with their goals.
Level 5 — 8
If your investment values add up to a number between 5 and 8, you’re likely a beginner investor seeking to take on little risk or an intermediate investor with a short time horizon. In either case, we advise you to invest in our Yield Fund or Buy The Dip tokens.
These tokens will help reduce short and long-term market volatility while also helping you weather the market no matter its condition. By investing in these tokens, you’ll take an innovative and strategic step that will pay off in the long run.
Level 9 — 10
If your values tally up to a value between 9 and 10, you are a middle-of-the-pack investor. Your market exposure should equal that of spot plus yield generation or a smart alpha layer. You will experience standard market volatility but outperform the market over a complete cycle because of the products in your category.
You are neither overly conservative nor overly aggressive; your product selection options are the greatest, ranging from Yield Funds to Algorithmic strategies like Macro Trend or Quantum Momentum, or you can choose from any lower-level funds and still invest comfortably. In general, you are not risk averse but also not a gambler.
Level 11 — 14
If your values tally up to a value between 11 and 14, your goal should be to take on as much risk as possible to provide the highest portfolio return possible. This means choosing our most advanced structured products, which will outperform the market by many multiples but will face significant drawdowns. As long as you remain committed to the strategy’s macro outperformance, you will be rewarded in the long run. By doing so, you’ll be putting yourself in a position to achieve the highest possible portfolio return.
Of course, this higher level of risk means that there is a chance that you could lose your entire investment. However, if you are willing to accept this risk, our team is confident that we can provide you with outstanding returns.
About This Survey
Thank you for taking the time to complete this survey. Your feedback is essential to helping us fine-tune our Portfolio Builder tool. When we integrate it with our Robo-advisor layer, the goal is to provide personalized and custom portfolio suggestions that accurately reflect your needs as an investor. In the meantime, we hope you found this five-part quiz enjoyable and informative. If you have any questions, comments, or concerns, please don’t hesitate to contact us on Discord. Thank you again for your time and input.
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