If you are new to investing and don't know how to approach EXC, this article will be perfect for you.
Straight to the point: Buy and Hold Strategy is the answer.
So far, this site has explained the functions and background of EXC and i am sure many people are realizing the value behind EXC. However many people may still be confused on how to approach it. Thus, this article will dig into the best investment strategy to help you achieve the greatest return on EXC's.
One of The Principles of Investing
As there are many types of "investments", ranging from day traders to long-term investors within different types of markets, there is no method or strategy that will apply to all investments or 100% provide you with profit.
Choosing a Loss Cut Line
One of the most important thing to do first is to make a 'loss cut' line to prevent a big loss.
Peter Lynch, a leading investor who was the fund manager of the well-known Magellan Fund (Fidelity), lists the following as "Most Dangerous Things People Say About Stocks": ..
- if it’s gone down this much already, it can’t get any lower
- Eventually they always come back
- It’s always darkest before the dawn.
- When I rebound to 10, I’ll sell.
(Source: One Up On Wall Street / Peter Lynch)
Basically, when the share price goes down, the share price may never return. Many professional fund managers are said to be cutting losses in the range of 10% to 20% decline.
By the way, in the case of virtual currencies, many currencies have plummeted by more than 80% after peaking in January 2018. Although they have started to rise in 2021, i believe after this bull it will be the end for most cryptocurrencies including bitcoin.
EXC tokens are issued by a digital central bank called GMF, and US dollars paid in exchange for EXC tokens are reserved in the digital central bank. If the value of EXC tokens drop to 50% of the peak price, the GMF will use the US dollar as a source of funds for buying operations. As a result, the price of EXC's a will not drop below 50%.
Thus, no matter when and how much you invest, you will not lose more than 50% of your money. The cheaper you buy the EXC from the peak price, the lower the risk is of losing your money.
This chart shows the price movements of EXC for the entire period from its listing on November 30, 2018 to Feb 2019. Immediately after listing, the volatility was high due to the small number of market participants, but the current price has converged to the theoretical value and is stable. The peak price at this point is at $ 12022.9, so if you bought 1 EXC token now, the buy back operation will work so that you will not lose more than 50% ($ 6011.45).
Is a loss-cut line necessary for EXC?
If you were to follow investment principles, you should also set a loss cut line for EXC tokens. However, in the case of EXC's, as long as we can expect future price increases in terms of intrinsic value and fundamentals, i judge that loss cut is not necessarily needed.
Berkshire Hathaway, led by Warren Buffett has declared that he will buy back shares when the price drops to a certain level. Since market participants understand that the share price will not go down below Warren Buffet's buy back level, investors are actually willing to purchase more as the price drops.
This is one of the factors that i believe will drive EXC's price up. The Excor Ltd. white paper clearly states the buy operation, so investors will be willing to buy as it comes closer to that line. Hence, it is highly likely that the value of EXC's will rise before hitting the 50% mark.
In conclusion, EXC is a long-term holding investment. In the words of Mr. Fusa, the first year is a period of "demonstration experiments" to gain credibility, before they allow central banks around the world to implement the EXC Platform.
The best thing to do will be to just wait until this long-term project advances. However, the value of EXC may rise before Central Banks implement this system as people start to realize it's fundamental value.
Since the patent of the technology used in EXC's are valid for 20 years, the superiority of EXC is guaranteed for at least 20 years. During that period, we are aiming for a market capitalization of 1% of fiat currencies – which is around 10 trillion dollars.
Hence we believe the "buy and hold strategy" is the appropriate investment strategy when investing in EXC.
There are many shares that drops in value and never rise back, but EXC has a mechanism to protect investors through their high security and buying operations. It is not well known in the world and may be a so-called "bargain" investment.
Given the mechanics of EXC's and the developer's vision, the buy-and-hold strategy is probably the best approach.
However, it is recommended to decide the investment policy in advance, including the loss cut in precaution to unexpected events.