Most people are familiar with the mantra 'Buy Low, Sell High,' but have you ever heard of the opposite? Sell high then buy low. You can make money on your chosen investment while its price goes up, but how do you make money when the prices are going down? Do you cash out and wait until prices are going up again? If you do that, you are missing out on a great money-making opportunity.
Choose an investment and stick with it
Before investing your money in anything, it pays to study it first. Learn the ups and downs of the market, observe how low the prices can go or how expensive it can get. Whether you buy stocks, bonds, or bitcoins, you have to know the investment, BITBROKER suggests. When you make transactions with it, do so via methods that can give you an external record such as credit cards or bank transfers. This way, you will have a solid record of how much you paid for it and you can gauge how much you can sell it for.
Sell high, buy low
So how exactly do you make money when prices are falling?
If you own the investment units, then it is simple: sell it at the current price and wait for the price to fall low enough so if you buy that investment again, you can earn a profit. For example, sell 100 shares of Company XYZ at GBP 60, then buy the same amount back when the price hits GBP 50. After those transactions, you will have GBP 100 and still own a hundred shares of the company, ready to take advantage of should the price go up again.
This example simplifies the process but that is the core concept. The more volatile the market, the greater the opportunity to make money while the trend is erratic. But be wary: keep an eye out for your investment lest you lose track of them and lose your money.