3. Trading, Buying and Selling Strategies For NFTs

Eadric Ricmund

A break down of the strategies you can use to insure a positive and fun time in the NFT space. NFA (not financial Advice)

Trading Strategies

With NFT trading strategies there are two methods. One is mint on release then sell on secondary and the other is buy low sell high on secondary. Mint will always get you the lowest prices unless secondary prices drop below mint. People see the most gains (if there is any) through minting

however, with that said there are projects where their secondary market value is close to mint, but either due to lack of discovery or people being distracted by the latest hype those prices are temporarily low. As the project continues in development (if the project is good) people will end up discovering it and the prices will slowly trend up. If you decide to flip off secondary it will require a bit more patience, but can be just as rewarding.

When determining what NFTs to buy there are overarching rules (keep in mind these are not financial advice so experiment, do your own research, and test the waters) and 3 exit strategies

The overarching rules are:

1) Only buy what you like. NFTs for the most part, with exception of a few, have no intrinsic value. It is just like art in the real world. Value lies in the eye of the beholder and the community/hype surrounding it. Unlike art, there are projects that can create utility that will provide the NFT intrinsic value, but if you want to get these stuff for cheap, it is usually before those utility is implemented so you are betting on a promise. It's always a good idea to go in thinking that this stuff may go to 0, so only buy stuff you appreciate the art of. If it does go to 0 you at least have the art to enjoy.

2) Always get involved with the community and dive deep into the project's social media, website, and white-paper or roadmap. Does the community seem friendly? Are people talking in chat and having a good time? Are the founders' good people? Are their twitter followers real? Are their discord members real? This is the whole Do Your Own Research process. Ask as many questions that you want UNTIL you are comfortable and confident that this project isn't just trying to steal your money.

3) Projects with complex road maps deserves complex questions. If a project wants to make a metaverse? Really grill them to see how they are going to make that money since indie open world game development costs around 500K USD AT the BARE MINIMUM without paying anyone outside of artists and programmers. NFT royalties, unless everyone uses a specific type of marketplace and secondary market value skyrockets, isn't the answer. The way Claymates did it was smart. They essentially used the mint money to try to establish multiple sources of income first before doing their Metaverse.

The Three Exit Strategies:

1) Sell when the value of your NFT reaches the amount of gain you desire. Remember on a $1000 investment, if you can make 25% gain off of every trade and you put all your money in that trade. Just 30 trades can make you a millionaire. There is no need to get too greedy. (Again, not financial advice, and its highly not recommended to do this. Personally, I would recommend making back your initial investment first and take that money and put it in somewhere safe THEN do this with House money [Money from profits]) Of course the gains in the NFT space, if there are gains, things easily double or triple in value overnight depending on the hype or attention around a specific project. So, pay attention. If famous people get in then the growth in price will be higher than 100% or 200%. Raging Teens Clan is a perfect example of this.

2) Holding long term. In the Cardano NFT space. We are still early. The oldest project isn't even a year old. We are only starting to see utility for many projects rollout this year. If we see higher adoption of Cardano, we see higher demands, so prices will go up on the long term. Again, this is IF Cardano NFT space have increased adoption rate. If there is a project that can last the test of time, then holding on to it long term is a good idea. An example of this is SpaceBudz. They were the first so now they are worth 5 figures and can only go up from here.

3) Find utility projects that can generate "passive increase in value" and just hold on to them as long as you want. Once their utility is implemented, they will make you money by just holding onto them. Good examples of this are... well, THIS project here. Some other examples of this are any Metaverse project.


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