By : Khawar Nehal
Date : 2 August 2018
For trial of ICO content
To invest or not.
Since ICOs are a speculative investment and usually not connected to any other valuable commodity or item. It should be considered as a high risk investment.
As most have learned for a fact, these investments are highly volatile due to their lack of value connection to other commodities or items and also because of the emotional nature of most of the investors in the community. Mature markets have less emotional investment communities and thus a lot more stability in prices.
As a high risk investment, the maximum a portfolio percentage which is recommended for allocation is 10% of the overall portfolio.
There are exceptions in ICOs which are connected and are like shares. They can be consider some form of crowd funding for shares. Not really a pure ICO. It is more like getting funding for the commodity or item which is linked to the ICO offering.
A good way to get better investments is to link the ICO with some other item of value. For example the shares of a movie venture or make a new company and offer shares in the company to each ICO coin holder. This helps create a better value and demonstrates less risk. Because now a thing of value in the real world is connected to each coin and the value of the ICO has a minimum book value which is the book value of the item connected to it. This shall create a sort of floor price to the valuation of the ICO in real world terms. Normal ICOs have no floor limit and the value is totally based on the emotions and valuation of the investors.