Litecoin Swap Strategy: How to Diversify Your Portfolio

It is no news that the crypto market is constantly evolving. Therefore, sticking to just one coin, in this case, Litecoin, might mean missing out on bigger opportunities. Diversifying your portfolio can help you manage risk, maximise potential returns, and explore new projects with real growth potential.

But where do you start? How do you trade your Litecoin for other digital assets safely and strategically? This guide breaks it all down. Read on to find out why diversification matters, smart strategies to follow, and a step-by-step process to swap Litecoin for other cryptocurrencies without stress. 

Why Diversify Your Crypto Portfolio?

Diversifying your crypto portfolio means spreading investments across different assets (cryptocurrency) instead of relying on just one. In crypto, this helps to:

1. Reduce Risk: The crypto market is not the safest investment option, as it is highly volatile, fluctuating rapidly and unpredictably. But if you spread your portfolio across cryptocurrencies with different risk profiles, you can manage the effect of volatility more effectively.
2. Improve chances of high returns: The crypto market may be an emerging field, but it is innovative, with unique coins offering unique use cases. This also impacts their prices as their performances may be affected according to the industry to which they belong. Due to this, you can increase your earnings from multiple sources.
3. Enhance portfolio stability: This is particularly beneficial to long-term investors focused on steady growth over a long period. Investing in different cryptocurrencies can help stabilise your portfolio by reducing its volatility. This is because your crypto coins aren’t likely to experience the same sharp and vulnerable price movements.
4. Increase flexibility and control: When you allocate your investment across various coins, you can choose according to your risk appetite, investment goals, and market conditions. This provides you with more flexibility and allows you to manage the outcome of your portfolio effectively.

Best Strategies for Crypto Diversification

Note that not all cryptocurrencies have the same risk-reward ratio. Here’s how to diversify strategically:

1. Invest Across Different Crypto Asset Classes:

Your portfolio should include a mix of:

• Large-cap coins (Bitcoin, Ethereum) – stable and established.
• Mid-cap coins (Solana, Polygon) – potential for high growth.
• Stablecoins (USDT, USDC) – act as a hedge against volatility.
• Emerging altcoins – high risk but potentially high reward.

Remember to follow the 40-30-30 Allocation Model. A structured approach ensures a balanced portfolio:

• 40% in major cryptocurrencies – Bitcoin (BTC) and Ethereum (ETH) for stability.

• 30% in mid-cap altcoins – for example, Solana (SOL) and Cardano (ADA) for growth potential.

• 30% in emerging cryptocurrencies – New projects with strong fundamentals.

2. Balance by Market Capitalisation

Bitcoin and Ethereum have high market capitalisation. This is why they are top coins in most portfolios. However, you should not neglect coins with mid to low capitalisations, as some of them are likely to grow and give high returns.

Here are a few examples:

• High market cap: Bitcoin, Ethereum – low risk, steady returns.
• Mid-market cap: Solana, Cardano – moderate risk, high potential.
• Low market cap: Newer projects are high risk but could explode in value.

3. Conduct Thorough Research

To succeed in crypto investment, you must do your due diligence by researching the cryptocurrency you want to invest in. You should check out the crypto fundamental analysis, use cases, and the development team behind the coin.

4. Rebalance Your Portfolio Regularly

Market conditions are unstable. Therefore, you must sell underperforming cryptocurrencies regularly, reinvest in promising ones and monitor asset performance.

Key Factors to Consider When Choosing an Exchange

It is important to select the right exchange before selling Litecoin. Watch out for:

1. Trading Fees and Commission Structures: Low fees maximise profits.

2. Available Trading Pairs: Ensure the platform supports LTC to your desired cryptocurrency.

3. Security Features and Track Record: 2FA and SSL encryption. Always enable two-factor authentication (2FA) and verify withdrawal addresses by double-checking them through your wallet, exchange, and email confirmations before executing trades.

4. Geographic Availability and Restrictions: Ensure the platform operates in your country.

How to Sell Litecoin for Other Cryptocurrencies on Breet

Once you’ve decided to sell Litecoin, selecting a secure and efficient exchange platform is crucial. The Breet app is the best exchange to swap crypto for another crypto.  It allows users in Nigeria and Ghana to swap Litecoin for over 170 different cryptocurrencies quickly and seamlessly. 

Step-by-Step Guide to Swapping Litecoin for Other Coins on Breet

• Download the Breet app for Android and iOS or access the web app.
•  Create an account and complete the KYC verification process.
• Enable two-factor authentication (2FA) for extra security.
• On the homepage, select “ convert crypto to crypto”
• Choose your preferred trading pair (e.g. LTC to BTC or LTC to ETH).
• Enter the transaction details and verify the exchange rate.
• Send Litecoin to the provided deposit address.
• Receive the swapped crypto in your wallet within minutes.

Tracking Portfolio Performance Post-Diversification

Once you’ve diversified beyond Litecoin, keeping track of your portfolio’s performance is essential. Here’s how to monitor your investments effectively:

1. Essential Tracking Tools

Use these platforms to stay updated on your holdings and market trends:

• CoinGecko / CoinMarketCap: Track real-time prices and portfolio allocation.
• Delta / CoinStats:  Portfolio management apps that log your trade history.
• Glassnode / IntoTheBlock:  On-chain analytics tools for deeper market insights.

2. Key Metrics to Monitor

To ensure your portfolio remains balanced and healthy, keep an eye on these indicators:

• Portfolio allocation: Maintain a good mix of assets without overloading one category.
• Volatility index: Understand your risk exposure.
• 24-hour trading volume: Check how easily you can buy or sell your holdings.
• Correlation coefficients: Avoid investing in too many assets that move in the same direction.

You might be wondering when the best time is to rebalance your portfolio. Let’s discuss that a bit.

When and How to Rebalance Your Portfolio

Market conditions change, so rebalancing helps maintain your strategy. Here’s how often you might need to adjust:

Monthly: For active traders who react to short-term market trends.

Quarterly: Ideal for long-term investors making gradual changes.

Annually: Best for passive investors who prefer a hands-off approach.

Signs You Need to Rebalance

It’s time to adjust your portfolio if:

• One asset exceeds 50% of your total holdings.
• A specific sector (e.g., DeFi, Layer-1 chains) becomes too dominant.
• Regulatory changes significantly impact one of your investments.

By staying proactive and using the right tools, you can ensure your portfolio remains balanced and in line with your goals.

Frequently Asked Questions (FAQs) About How To Sell Litecoin for Other Cryptocurrency 

What are the tax implications of converting Litecoin?

Crypto tax laws vary by country. In some countries, there are tax implications covering Litecoin with other cryptocurrencies. A tax professional will help you know your obligations.

How do I time my conversions effectively?

To convert promptly, monitor market trends using tools like TradingView and CoinMarketCap. Also, watch out for price support and resistance levels, Bitcoin dominance trends, and on-chain data to make informed decisions.

What are the risks of diversifying from Litecoin?

While diversification reduces risk, it also introduces exposure to:

1. Volatile assets: Some altcoins have higher price fluctuations.
2. Liquidity concerns:  Low-cap coins may be harder to sell.
3. Security risks: Storing multiple assets across different wallets increases vulnerability.

To mitigate these risks, research projects thoroughly and allocate funds strategically.

How can I sell Litecoin in Nigeria?

The best way to sell Litecoin in Nigeria is through OTC platforms like Breet. Breet offers a fast, secure, automated trading experience with the best market rates. With a user-friendly mobile and web app, Breet offers seamless and automatic trading.

How much is Litecoin selling today?

Litecoin’s price fluctuates constantly as the market is highly volatile. This makes it unpredictable. However, Breet has an in-app rate calculator to help you check the latest exchange rates in Naira or Cedis.