What is FOMO and FUD syndrome? How to get over it?
- 1. What is FOMO syndrome?
- 2. What is FUD?
- 3. Why Investors Are Affected By FOMO
- 4. Who causes FOMO and FUD?
- 5. Symptoms of FOMO syndrome
- 6. Consequences of FOMO and FUD Inexperienced traders
- 7. How do you overcome FOMO and FUD psychology when investing?
- 8. Scam by creating FOMO and FUD
Many people are still wondering what is FOMO? What is FUD? Manifestations of FOMO, FUD syndrome like? Consequently, how to recognize and how to avoid protecting your assets in cryptocurrency trading? In the article below, BHO Network will explain most simply so that you can better understand these two terms. Let's find out now!
1. What is FOMO syndrome?
What does FOMO mean? Fear Of Missing Out represents the fear of missing out on the profits that can be made if you don't buy a certain cryptocurrency as soon as possible. Regardless of the current price of that cryptocurrency.
In the Crypto market, emotions drive transactions far more than rationality. Therefore, FOMO is a factor that greatly influences the decision-making process of cryptocurrency trading.
FOMO is the fear of missing out
2. What is FUD?
What does FUD mean? This stands for Fear, Uncertainty, and Doubt. FUD refers to investor doubt, fear, and uncertainty. The bad news is spread from unknown sources of a certain cryptocurrency (usually Bitcoin).
Traders tend to sell FUD Coins regardless of the current price. Therefore, it will cause a Panic Sell effect, a massive sell-off. This causes the value of that coin to decrease much in a short time.
FUD implies doubt
3. Why Investors Are Affected By FOMO
What Are The Reasons Why Investors Are Affected By FOMO? Here are some reasons that you should learn to know and update in time to avoid FOMO:
- Lack of understanding of the stock market and only following the crowd.
- Fear of missing out.
- Put too much faith in the stock market.
- Being too self-conscious or self-confident, impatient about yourself.
- Hoping for a big win.
- Many failures have made investors want to win even more.
Investors are always affected by FOMO
Read more: What is Margin Trading? How to play Trade Margin for newbies
4. Who causes FOMO and FUD?
Both FOMO and FUD are beneficial tools applied by influential individuals and organizations in the cryptocurrency market to serve their interests. Typically, organizations that create FOMO or FUD will hold control or influence over many significant media channels. As a result, institutions can influence as many traders as possible.
So what is the purpose of causing FOMO and FUD? FOMO is used as a tool to push up the price of cryptocurrencies. The purpose is to create liquidity to take profits. And FUD is a tool used to lower the price of cryptocurrencies. The goal is to collect as many cryptocurrencies as possible before activating FOMO to take profits.
FOMO and FUD caused by individuals and organizations
5. Symptoms of FOMO syndrome
Before going into the main issue, let's see if you are in the category or are affected by FOMO or FUD on your trading decisions. Usually, investors who suffer from FOMO and FUD syndrome will be inexperienced Traders in the market. Common symptoms of FOMO syndrome:
- Impatience when trading.
- There is no complete trading plan before entry.
- Trade according to news and events but not update the market fast enough.
- Analytical techniques are still not complex, leading to easily shaken judgments.
There are many manifestations of FOMO syndrome, including impatience when trading
6. Consequences of FOMO and FUD Inexperienced traders
The stock market is susceptible to these two effects. The most obvious consequence is that assets decrease after each FOMO or FUD. The bigger consequence is that traders no longer believe in their judgments and decisions when entering orders.
Traders have suffered a lot of losses due to FOMO and FUD. When a Trader no longer believes in his judgment, there is a high probability that the Trader's assets will go to 0.
The most obvious consequence is that assets decrease after each FOMO or FUD
7. How do you overcome FOMO and FUD psychology when investing?
So what to do to overcome psychology, and what are FUD and FOMO? If you are afraid of having symptoms of FOMO and FUD syndrome, you can refer to some ways to avoid them below:
- Accumulate enough knowledge about the stock market: Investors need to learn and master market knowledge. This will help investors control buying or selling decisions.
- Understanding the business: This is the strategy of many successful investors such as Warren Buffett, Filip Fisher, Peter Lynch, etc.
- Build a clear investment strategy: Build yourself a strategy. invest and adhere to established principles such as investment in price or investment in growth.
- Determine the right time to stop loss: Be bold to place a stop-loss order when the stock price tends to be negative. Cutting your losses early can help you preserve some of your capital. Then you will find new opportunities more actively.
- Learn to control emotions: Before making decisions, take some extra time to consider whether emotions influence those decisions.
Learn to control emotions and accumulate enough market knowledge to overcome the fear of FOMO
Read more: What is stablecoin? Stablecoins classification in cryptocurrency
8. Scam by creating FOMO and FUD
Scam by creating FOMO and FUD? This is a worse case of the above consequences. Users are intentionally spreading FUD or FOMO by more skilled investors. This puts the victim in a mentally unstable stage and will take wrong actions such as buying or selling bluff.
Then the scammers creating FOMO and FUD will do the opposite. That is buying or selling a lot of Trader's Coin, causing newcomers to lose unjustly. This is often the case with little-known projects, or the project team has a precedent for doing this on previous projects.
Fraud by creating FOMO and FUD puts the victim in a mentally unstable stage and will take wrong actions
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BHO Network hopes that through this article, you will better understand the syndrome "What is FUD?" and "What is FOMO?". Please contact the business immediately for more detailed answers and support if you have any other questions!
Published on February 16, 2022
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