When It's Time to Rebalance Your Crypto Asset Portfolio

I think rebalancing a crypto portfolio to reduce exposure to a single crypto asset is the most intuitive yet completely wrong move long term investors make.

Maybe your portfolio starts off nice and balanced and may look something like this.... Maybe ICO "C" is that coin you bought only because your friend Carl would not leave you alone and you were sick of mopping up his froth from your new tiled floors every time he visited.

Maybe your portfolio now looks like this.... You're now Carl's new best friend.

Here's the thing about rebalancing a portfolio.

Under modern portfolio theory, you want to regularly rebalance your allocations to manage risk and maximize returns.

The math seeks allocations that constantly balances your downside risk while maximizing gains, taking into account every market event that may happen, like say famine, an energy shortage or a madman leading a rouge nation into war.

Where does your crypto portfolio fit into this?

At this stage of the game, crypto assets are so nascent, they fall under a single sector called "Emerging tech." These are not mature industries.

These are unproven technologies that have not yet made it into the public equity markets to take their stake in the global economy.

In many unregulated and thinly traded markets, market manipulations along with pump-and-dump schemes can run rife.