Course Content
12 Terms Every Crypto Trader Should Know
I'm too lazy to read, what's the TL;DR? Fear, Uncertainty, and Doubt (FUD): Spreading of fear and misinformation to gain an advantage. Fear Of Missing Out (FOMO): The emotion you feel when you panic buy. HODL: Buy and hold on to it for a long time! BUIDL: Keep your head down and build the next financial system. SAFU: Funds are safe! Return on Investment (ROI): How much money you are making (or losing). All-Time High (ATH): The highest price ever recorded! All-Time Low (ATL): The lowest price ever recorded. Do Your Own Research (DYOR): Don't trust, verify. Due Diligence (DD): Smart people make decisions based on facts. Anti Money Laundering (AML): Regulations that prevent criminals from hiding their money. Know Your Customer (KYC): Regulations that make exchanges verify your identity.
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12 Terms Every Crypto Trader Should Know
About Lesson

Return on Investment (ROI) is a way to measure an investment’s performance. ROI measures the returns of an investment relative to the original cost. It’s also a convenient way to compare the performance of different investments.

Here’s how you calculate ROI. You take the current value of the investment and subtract the original cost of the investment. Then you divide that number by the original cost.

ROI = (Current Value – Original Cost) / Original Cost

Let’s say you bought Bitcoin at $6,000. The current market price of Bitcoin is now $8,000.

ROI = (8000-6000)/6000

ROI = 0.33

This means that you’re 33% up from your original investment. It’s also worth taking into account the fees (or interest rate) that you have to pay to get a more accurate picture.

Raw numbers aren’t the whole picture, however. When comparing investments, other factors are also at play. What are the risks? What is the time horizon? How liquid is the asset? Can slippage affect your purchase price? ROI isn’t the ultimate metric by itself, but it’s a useful tool to measure your investments’ performance.
Calculating position size is crucial when thinking about investment returns. If you’d like to read about a simple formula that will help you effectively manage risk, check out How to Calculate Position Size in Trading.
Exercise Files
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