I have always been an avid fan of fantasy trading, such as fantasy sports. I remember when I first got into trading fantasy stocks and crypto, dealing with fantasy crypto portfolios was a completely new concept for me. Like most beginners, I made mistakes but eventually, I learned the ropes.
Now that I have reached a certain level of proficiency in engaging in this niche, I realize I could have avoided many pitfalls to maximize my gains back then. So I thought I would share what I have learned so far with all of you fantasy trading aficionados starting your journey.
These tips will not only help you avoid the most common mistakes but also ensure that you reap maximum benefits from your investments.
7 Ways to Maximize Your Gains in Fantasy Stocks
Here are the seven most common areas you should focus on when participating in fantasy trading contests from time to time:
1. Build Your Strategy for Fantasy Trading
You will come across various platforms offering various fantasy finance options, but you should do some research to help you choose the right one. While some of these platforms are open to traders of all levels. Others, like StockBattle, are for traders who know the market and require that you know at least the basics of fantasy trading.
For instance, if you are participating in a fantasy trading contest for stocks, you must have some background knowledge about the company you’re picking. Learn to read their weekly charts on stock dynamics with current stock prices and how they performed in the last contest. Place your faith in several of those options and add them to your portfolio to compete against other contestants.
2. Never Overtrade
Overtrading is one of the most common mistakes most beginners make, as they try to make 10 or 20 trades a day. No matter how confident you are, this is tricky terrain, and you may end up losing more than you bargained for. So do not be too zealous, as excessive trading may lead to poor decision-making.
So let’s suppose that you just started participating in fantasy trading contests. and you chose the best-performing crypto or stock portfolio. In this case, it would be best to win one contest at a time. This will allow you to focus on that single game and use all your knowledge to win it.
While you may have the strongest portfolio, indulging in too many contests may result in an error of judgment, especially if you are a beginner. So, I would suggest picking your battles one at a time.
3. Diversify Your Portfolio
As confident as you may be about a company, it is always best never to put all your eggs in the same basket. Just like in conventional trading, you must have a contingency plan and take calculated risks by investing in multiple stocks or virtual crypto when battling other contestants.
Choosing the top five virtual crypto or top-five fantasy stocks is a good start to create a diverse fantasy trading portfolio.
For instance, you will naturally feel inclined to bet on Bitcoin (BTC) as it is the most powerful crypto coin in the world. However, it does have its highs and lows during the day due to the market’s volatility. So, you do not know how well BTC will perform during your contest.
If you pick multiple coins, it gives you a better chance to win and recover your money, even if the best coin on your list does not do as well as you expected. Dealing with five cryptos at a time gives you five chances to win instead of just investing in one and hoping it outperforms your opponent’s options.
While this may sound time-consuming, a little research before diving right into fantasy trading can help in the long run. The more you research, the more you learn. This can also give you a competitive edge when battling against competitors on a platform such as StockBattl.
Keeping track of crypto coin performance, current value, recent trends, and their market cap can help you make better choices when trading fantasy crypto. Whereas, knowing your favorite companies’ price history and trading volumes can help you create a strong fantasy stock portfolio. This way, you can ensure that you can reap the maximum winnings for each game you enter.
Look at the two pictures below to give you an idea of what crypto performance and stock performance charts look like.
Stock Performance Chart
These performance charts give you an insight into how different cryptos and stocks have been performing in real markets. This information can give you an edge by investing in the best-performing options.
4. Do Not Fall for Media Propaganda
There are quite a lot of negative reports out there about how risky trading is. You will also hear about the volatility of stocks and cryptocurrencies and that the bubble will burst sooner or later. However, do not fall for this common misconception as these assets are here to stay. Fantasy trading contests allow you to take control and take calculated risks using your knowledge and experience.
For instance, when participating in a fantasy trading contest on StockBattle, you get to see both fantasy stocks and fantasy crypto’s real-time performance. It is totally up to you when, where, and how much you would like to invest to multiply your gains.
5. Learn to Understand the Market Trends
Whether you are trading fantasy stock or fantasy crypto, you are as good a contestant as your understanding of the market dynamics. An inadequate level of knowledge in either can lead to costly investments. So learn the stock dynamics and crypto trends like the back of your hand to maximize your gains in these contests.
Let us have a look at the image below:
In this image, you can see the steady rise in the prices of crypto. However, when volatility comes into play, there is a huge risk of a trend reversal, and the price comes tumbling down. This is a problem of investing in the price at a higher trend. But if you have not, this is the best time to get in because the price is more likely to pick and give you a chance to increase your winnings.
You can see various stages of how a fantasy trading contestant may behave as the game progresses. You feel optimistic as the game begins, and as the stocks reach their highs, you might get overconfident and bet with a misconception that your stock has a chance of winning.
However, this is the highest risk point because at this point fantasy crypto or fantasy stock have nowhere to go but downwards. Therefore, knowing the exact point when you get into the game is key, and you can only know this if you learn about the dynamics of the market’s trend.
6. Never Go “All-In”
You may think that dealing with more money on as many options as you can is going to increase your chances to win more. In reality, this is your quickest ride to Poor Town because, accumulatively, you will end up losing more money than you win. You must limit yourself and decide how much money you are willing to spend and when you should stop trading.
7. Manage Your Risk
My intention to share these insights and tips about fantasy stocks and fantasy crypto is to have your best interest at heart. I would suggest that you learn to manage your risks, learn about fantasy trading, and follow the expert participants on the platform you are using.
So, before you build your own portfolio, you can replicate the portfolio of an expert trader and learn the ropes while enjoying steady wins.
Do not fall for the classic temptation to trade all your money and hope to make one big quick win. That is how people and businesses go bust. You may enjoy beginners’ luck, but it is not going to happen all the time.
This is especially true when you are trading fantasy crypto because it is a highly volatile domain and no matter how great the previous price trends may seem, set a cash limit of how much you will be willing to participate and stick by it no matter what.
If you simply adhere to the above-mentioned tips, you will successfully avoid the most common pitfalls associated with fantasy trading. Remember that while you trade, it is still your hard-earned dollar you’re using for these contests. So, trade wise and trade safe!