What Does FUD Mean in Investing?
FUD, in the context of investing, stands for Fear, Uncertainty, and Doubt. Like FOMO, this term too refers to a specific mindset in relation to an asset or the investment market in general. Let’s find out more.
Fear, Uncertainty, and Doubt is a manipulation tactic that spreads a negative sentiment around an asset. This is done to cause a drop in asset prices. Just the rumor of a possible event negatively affecting the price of a coin can cause FUD. People sometimes may take things out of context or exaggerate a piece of information to create a fake buzz and manipulate investors to sell. The more disastrous something could possibly be, the greater the fear surrounding it, and the more it becomes a target for people to spread FUD.
Why would anyone do something like that? Well, there are situations in which you can benefit from a cryptocurrency declining in price. For example, if you’re shorting crypto.
Anticipating regulations by various governments and countries is a great example of something that can create Fear, Uncertainty, and Doubt. Try not to fall into the FUD trap by always checking if your sources are reliable.
Familiarize yourself with more such common trading terms with the help of this article:
Recommended: Common Terms Every Crypto Trader Should Know
Disclaimer:
This blog is for educational purposes only. The information we offer does not constitute investment advice. Please always do your own research before investing.
Any views expressed in this blog and by BOTS do not constitute a recommendation that any particular cryptocurrency (or cryptocurrency token/asset/index), portfolio of cryptocurrencies, transaction, or investment strategy is suitable for any specific person.
