Assuming an investment of 1,000 USD in three types of coins, we can analyze and establish some relationships between losses and profits when investing the same amount in the cryptocurrencies VeChain (VET), Cardano (ADA), and Shiba Inu (SHIB). The main factors affecting profits or losses include the fluctuating value of the coins and the number of cryptocurrencies that can be purchased with the initial investment amount. Below are some detailed analyses:
1. The correlation between purchase price and the number of cryptocurrencies
VET has the lowest price compared to ADA and SHIB (0.03956 USD), which means that with an initial investment of 1,000 USD, the investor will be able to buy the most VET coins (approximately 25,292 VET).
ADA has a higher price (1.07 USD), resulting in a significantly smaller number of ADA coins that an investor can purchase compared to VET (approximately 934.58 ADA).
SHIB has the lowest price per unit (0.00002707 USD), but with an investment of 1,000 USD, the investor can buy an extremely large number of SHIB coins (approximately 36,931,406 SHIB).
2. The impact of price changes on profits and losses
When the price triples:
This price increase benefits coins with large purchase quantities (such as SHIB and VET), as profits will be larger due to the number of coins held.
All three cryptocurrencies will yield a profit of 2,000 USD when the price triples, but SHIB provides the highest profit in absolute value because of the largest number of coins purchased.
When the price drops by 50%:
VET, ADA, and SHIB will all experience equivalent losses (500 USD) when prices drop by 50% because, although the number of coins purchased differs, the percentage decrease is the same (50%). Regardless of which coin you invest in, when the price halves, the value of your assets will also decrease by half from the initial value.
3. The relationship between investment value and risk level
Low-value coins like SHIB and VET present high levels of risk when market value drops sharply (due to large purchase quantities). However, when prices rise sharply, the profits obtained will be greater compared to high-value coins like ADA.
ADA has a higher value, leading to a smaller number of coins, but this also brings certain advantages when the value of the coin increases, because when the value of ADA triples, the investor can still achieve significant profits. However, in case of a price drop, losses will be less severe due to the smaller quantity of coins.
4. Volatility and investment strategy
When investing in low-value cryptocurrencies (like SHIB), investors need to endure significant market volatility, as values can change dramatically in a short time. But if the price of this coin rises sharply, the investor will reap large profits due to the large number of coins held.
ADA will experience less volatility but may not yield as much profit as SHIB or VET in the case of a strong price increase; however, in the case of a price drop, ADA may protect some of the invested capital due to a smaller quantity of coins.
5. General conclusion
SHIB can provide the highest profits when its value increases sharply (due to the large number of coins), but at the same time has the highest risk if its value decreases sharply due to the very large number of coins that can quickly reduce overall asset value.
VET is a more stable choice with a moderate price, a reasonable amount of coins purchased, and can help offset losses if prices decrease.
ADA offers lower risk when prices drop, but it will not yield as much profit as SHIB or VET if prices rise sharply. The ADA market may be more stable, but it also requires a long time for significant growth.
Summary:
Profits and risks depend on the number of coins you can purchase and the price changes of each coin.
Investing in low-value coins (SHIB, VET) will yield high profits when prices rise but also entails high risks when prices fall.
ADA has a higher price, a lower risk of price decrease, and is easier to maintain the value of investment capital in case of market volatility.
