Who profits more during bull Market, trader vs holder?
Who profits more during bull Market, trader vs holder?
When we talk about bull market we talking of a 2x price appreciation, and let take bitcoin for example, who profits more between a long term and me holder who bought bitcoin at a price range of $35,000 and bitcoin reaching $100,000, so a trader who open his trading position of 10 and with a good amount of capital around when the price is 71,000, so between the two who stand the chance of profiting more putting into consideration the timing that it involved for both parties.
Taking this question out of my personal curiosity of the market and how each bull run. Ale more millionaires in the bitcoin ecosystem, via trading vs holding.
In my opinion and experience, I’m more profitable being a holder. And on the perspective of the rich and wealthy investors, they’re not day traders but investors and considerably good at holding. They trade, yes but at most of the time they’re holding most of the stocks and assets that they have before flipping it. And that’s why I think that during the bull run, the most profitable are the long term holders as there’s lesser effort compared to the active traders that they have to be pressed by the market and compete with the others in the market which how it goes to become winners and profitable.
If you buy bitcoin in the spot market, you can send the coin to a noncustodial wallet. You will have complete control of your coins and you will be able to sleep very well at night and no issue will be from the exchange like hack. But if it is derivative, you have to leave the coin on the exchange. What if the exchange is hacked or your coins is seized.
If you open 10x leverage for long position at $35000, the liquidation price would be around $31500. Do you know that when bitcoin first went above $35000, it went back below $2700 again. This can even occur several times.
If you are lucky that bitcoin price does not go back down to the extent your money is not liquidated, you will make money more from 10x position. But also if the exchange is not hacked and also if your coin is not seized.