How to Create an All-Weather Crypto Portfolio?

There’s no perfect formula for curating a well-balanced Crypto Portfolio. Here are some top strategies for building their own!


  • Curating a well-balanced investment portfolio should start with knowing the personality and preferences of the trader as an investor.
  • Generally speaking, the foundation of any investment encompasses this basic formula:  Well-Balanced Portfolio = Goals + Investment Type + Risk Tolerance + Diversification of Assets
  • Diversification and regularly rebalancing portfolios in Cryptocurrency investment set-up are two major strategies to build and manage a well-balanced portfolio.
  • Use a manual tracker via spreadsheets or online software to regularly check on each investment and its profits.

Read the Tagalog Version here!

Building A Balanced Crypto Portfolio

They said, there’s no perfect formula for curating such a well-balanced crypto portfolio but the truth is, every trader must have to know these basic expressions to discover the perfect combination for you. In this article, top strategies will be revealed for us to guide fellow traders in building their own!

Building a well-balanced crypto portfolio varies from one trader to another. These specific methods might be perfect for Trader A but might not be effective for Trader B, therefore, it is important to know and learn about yourself as a person before making major decisions. Yes! Knowing about yourself comes first even when it comes to investing, here are some questions to help you:

  • What would be your investment goals for the next 6 months? What about your long-term goals?
  • Are you an aggressive type of investor, conservative, or moderate?
  • Do you already know your risk tolerance?
  • How about your usual asset allocation?

You see, it is quite similar to a traditional investment portfolio. It all boils down to this basic formula:

Well-Balanced Portfolio = Goals + Investment Type + Risk Tolerance + Diversification of Assets.  

However, the Crypto variable is still missing! Even if it has the same foundation, there are still factors to unleash but this is where the exciting part comes in, let’s all find out some of the strategies for managing a Crypto Portfolio!

Diversification and Inclusion

In the Crypto case, it is generally encouraged for a trader to diversify their assets depending on their preference. However, it is still up to the trader to decide whether diversification will be beneficial to their strategy.

The pros of diversification can reduce the risk of their investment as each asset possesses a certain price movement which results in a negative or positive note. But the con is the trader will not benefit from large growth.

Let’s put it this way, Trader A allocates his investment to only one crypto asset with the possibility that if the specific asset fails, Trader A will be left with nothing not unless it is well monitored. However, this is subject to the volatility of the market.

Now, let’s compare it to Trader B, he allocates his investment into 5 different crypto assets. Let’s say, Asset 1 and 2 falls over, it is still acceptable as long as the remaining assets would be profitable.

With diversification, you actually have a contingency plan once you diversify your assets.

Rebalancing Portfolio Regularly

As it was mentioned earlier, the crypto market is highly volatile, which means that it is unpredictable and always subject to change. If a trader rebalances their cryptocurrency portfolio periodically, this helps prevent major losses and protect traders in their investments.

For instance, Trader B decided to retain all his diversified assets as is. Come 3rd quarter of his first year of crypto investing, the price of that crypto asset dropped by 68%. Trader B cannot redeem the loss that he incurred from not rebalancing his portfolio on a regular basis.

If Trader B had rebalanced his portfolio, it would have given him some spare cash which he can then allocate to buy the dips when it comes.

The lesson here is that even if your investment has been doing very well for a long time, this does not mean that it will stay that way for the next couple of weeks or even months.

What’s next? Tracking your resources!

Investing is about knowing how to spread your resources around for the largest gains possible. More often than not, traders and investors do have their own trackers to have a view on what assets they have, how much cash they have left, and how else can they spend their resources.

This can be done manually by using spreadsheets or by utilizing other available software that can be found online to calculate each holding and profit easily and more conveniently.

Disclaimer: The information and publications in this article are not intended to be and do not constitute financial advice, investment advice, trading advice, or any other advice or recommendation offered or endorsed by Coins.

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