Best strategy for Dollar Cost Averaging - page 2.

jaberwock

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Quote from: worle1bm on January 27, 2023, 12:46:51 AM

It's good strategy to accumulate coins with you overtime if you don't have sufficient funds to invest at once.This is applied by many traders by putting fixed amounts weekly or any time period they find suitable but for me it's good if you have say 2+ years in mind that will help you get some good amount with you but don't invest too small amount that would not cover even the tx fees say make it above $10 for best.

There are many kinds of cryptocurrencies and many of them are cheap so there is no need for us to accumulate a lot of funds only to invest on them. If you prefer to invest on large coins then you can do the DCA strategy if you do not have the budget to buy a one whole coin. I think DCA is mainly done by the investors and not by the traders. Traders have a different approach when it comes to making a profit.

2 years of DCAing is quite long but I think there will be bull runs already that will come within this period so it's inevitable that one must sell but this is a good idea so that we will have another set of funds for another round of DCA's.

justdimin

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

You may keep your investment habits as simple as possible like how I am doing. I mean there would be no compulsion for same amount and in regular interval. I am doing like a piggy bank saving; yes, I do buy bitcoins based on my available fund and based on my interest on buying and not regularly buying or not for the same amount. But, there are enough reasons why criteria for DCA emphasises these. Let me explain.

If you buy for a small amount during bull market and for bigger amount in bear market then your overall profit/loss level will get impacted heavily. Similarly when you are not buying at regular interval then you may miss any "ultimate bottom" levels.

But, when you are planning for long term holding like 5 years or 10 years then you never need to bother any of these criteria as bitcoin market will peak for every 4 years and you will be into profits after 4 years for sure.

worle1bm

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It's good strategy to accumulate coins with you overtime if you don't have sufficient funds to invest at once.This is applied by many traders by putting fixed amounts weekly or any time period they find suitable but for me it's good if you have say 2+ years in mind that will help you get some good amount with you but don't invest too small amount that would not cover even the tx fees say make it above $10 for best.

samcrypto

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

The question is, what is your afford to do so? Is weekly ok to your or better if you do this Monthly?
I have this strategy before when my weekly profit from crypto signature is still active, and its very effective for me because I was able to save some crypto and earn some profit at the same time. DCA is more about your commitment, so make sure you ready for this and you have the timeline to follow so you wont be force to sell. Also, better to have other savings to cover up for your emergency expenses.

deathcode

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

I have searched and seen that;

Quote

Dollar-cost averaging is the practice of systematically investing equal amounts of money at regular intervals, regardless of the price of a security.

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

https://www.investopedia.com/terms/d/dollarcostaveraging.asp

If you ask how I am, I have implemented DCA every month.
Why? Because I already have a plan and share the money I have.
For daily needs, for savings, for emergency funds and for investing.

But everyone must have their own strategy depending on their economic conditions.
And it also depends on how they plan to manage their money.

pawel7777

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Quote from: crzy on January 26, 2023, 04:56:02 PM

This could be a great interpretation but then again, its not guaranteed as the market is very volatile and risky, probably the risk with the top coins are lower compare to the other altcoins.

This topic is not about whether Bitcoin (or other assets) is risky or not, but about the best way of doing the DCA. The simulation I ran shows that it makes very little difference whether it's daily, weekly or monthly.

Quote from: crzy on January 26, 2023, 04:56:02 PM

My option could be a monthly basis, this can be more practical especially if you have limited funds.

Funds being limited is irrelevant here. Instead of buying monthly, you could split the same amount and buy weekly or daily, but again, it doesn't really matter.

crzy

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Quote from: pawel7777 on January 26, 2023, 04:49:12 PM

Run a quick simulation on dcabtc.com, results are not surprising, buying frequency made very little difference. The results for "monthly" are a bit distorted as the site doesn't allow to enter $ amount with decimals, so used $30 instead of $30.4.

	3 years	9 years
$1 daily	$2,112	$130,873
$7 weekly	$2,141	$131,053
$30 monthly	$2,169	$130,833

This could be a great interpretation but then again, its not guaranteed as the market is very volatile and risky, probably the risk with the top coins are lower compare to the other altcoins. DCA seems to be the easiest strategy to many since they don’t analyze the price from time to time and they are just waiting for their funds to come-in and they will invest right away. My option could be a monthly basis, this can be more practical especially if you have limited funds.

pawel7777

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Run a quick simulation on dcabtc.com, results are not surprising, buying frequency made very little difference. The results for "monthly" are a bit distorted as the site doesn't allow to enter $ amount with decimals, so used $30 instead of $30.4.

	3 years	9 years
$1 daily	$2,112	$130,873
$7 weekly	$2,141	$131,053
$30 monthly	$2,169	$130,833

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But Dollar Cost Averaging is a strategy it's self. The time intervals are up to you as an investor, Someone can do daily, weekly, bi-weekly or monthly also depending on the amount you will be putting in per interval.

What matters most is consistency, does your time interval allow you to buy a specific number of assets without straining yourself so much or making you think of selling off your assets at one point when you lack funds?

goaldigger

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

Its ideal to do this Monthly which is easy to achieve once you set-up your budget for this.
As long as you are buying good projects and good coins, I can say that this is worth it especially if you are able to start this during the bear market. Analyze the risk and plan your budget, DCA is a boring way of investing buy I can say that its worth it once you already saw you’re making profit. Have a target once and don’t be afraid to take profit.

Fatunad

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

I have searched and seen that;

Quote

Dollar-cost averaging is the practice of systematically investing equal amounts of money at regular intervals, regardless of the price of a security.

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

Doesnt matter on when you would get in when it comes to DCA because it would really be completely depending on you on when you would decide to enter.As long you do have the funds on doing
so then every price that is going down would really be ideal on doing that DCA.Its true that not all does have the money on doing this DCA and this is why its really that hard to maintain out
such strategy but its true that if you are really that going for long term then this would be the best shot. Ive been doing this on everytime the price do make out some decrease
because these are opportunities for you to buy cheaper coins.

palle11

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

The best for DCA is not to do it by random or weekly or monthly as you said but you need to do an analysis on your own first to check your support and resistance levels and then monitor through the chart to see where price will probably move to before you go in. Basically, it is good that you DCA when the price has dropped because you will have more chances of profit than when you buy on the high after price has broken for bull direction.

pawel7777

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Quote from: LoyceMobile on January 25, 2023, 01:05:03 PM

The point of DCA is that it doesn't really matter if you do it weekly or monthly. I'd say make it depend on transaction fees: if you buy small amounts, too can save money by buying slightly larger amounts less often.

Not quite, if your goal is to get a true average, than buying as often as possible would be the best way to do it. But it's not very practical and yes, fees can get in the way - unless they're purely determined as a percentage of transaction, in which case they're irrelevant.

The most convenient way, for someone who gets their primary income from employment, would be to set a recurring buy on the day of your pay day, or shortly after.

But as much as DCA is a simple concept, it's proven to be less effective on average than timing the market (i.e. buying a bit more on what looks like a bottom, and bit less on what looks like the top).

uneng

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DCA should be done in the moment you receive your paycheck. If you earn weekly, do it weekly, if you earn monthly, do it monthly. It's important to follow this strategy, so you don't distract yourself purchasing another stuff in your daily routine that will compromise your DCA plan.

Also, make sure to write the price you are buying BTC each new turn in a spreadsheet, so once you cashout your profits futurely, you can calculate accurately how much you have made and how much you have invested.

franky1

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if you are purely buying with new income (your wage) then continual buys when you get paid is great at this time of this year

but if you are buying using some savings. splitting up savings per month. you can customise it a bit

EG knowing the major window of trade is between $15k $90k (world economics of value:premium window)

put more in when the price is nearer to bottom and less as the price increases

EG if you have $24k you want to invest over 2023 meaning you set yourself a limit of $2 a month of your savings

realise that
if the market value: premium window is 15-90
the midpoint is 52.5
meaning the potential flippening of sentiment of when you change from a buyer to seller
(if you only want to invest for a year to exit at the year)

thus set limits of how much of your $24k you put in per month between the $15k-52k range

EG
$3k at 15k-24k
$2.5k at 24k-33k
$2k at 33k-42k
$1.5k at 42k 51k

mvdheuvel1983

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For me the right frequency for Dollar cost Average in bitcoin particularly in a bear market is the period that allows me to stick to the plan.
Basically, it is just to stick with whatever frequency that you are comfortable with. That is one that you feel you will do consistently. Just allow your personal and behavioural preference dictate it. No one can really tell you because it is not a one-size fits all approach.

livingfree

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?

There's no specific period of time of when I'm doing it. As long as I've got enough budget to buy bitcoin then that's my DCA, no specifics like weekly or monthly.

Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

What do you advice and why?

Just buy when you've got enough and you're not emotional. But if it's bitcoin and you're longing to do it in a long period of time then price doesn't matter to you.

What matters to you is when you've got money, you'll just buy and accumulate those bits/satoshis that you can buy with the current value that you've got.

goldkingcoiner

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

I have searched and seen that;

Quote

Dollar-cost averaging is the practice of systematically investing equal amounts of money at regular intervals, regardless of the price of a security.

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

https://www.investopedia.com/terms/d/dollarcostaveraging.asp

I am not completely sure what you mean by strategy for Dollar Cost Averaging since Dollar Cost Averaging is the strategy itself. If you were to ask me how I do it then I say you simply divide your money up and invest/trade as you would normally except not all at once. I personally use the daily scale and invest in each dip. At any moment, a giant red candle could appear and ruin your day. Same goes for the giant green candle. Nobody knows when or why it will happen but we know that it will happen. So the best course of action is to minimize the risk with DCA.

salad daging

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It depends on their needs how many dollars will be put in bitcoin and varies in this case because they also have to manage their cash flow all the time as long as with this DCA strategy because this is for a long time let's say 3 to 5 years in the future.

I do it weekly, it's not even how much dollars I put in, but at least $ 10 must be put in DCA or even more, it depends on the cash flow I get while I work and the income in the business that I run.
I started maybe at the right time when the bitcoin price was low, I did it until now, sometimes there are obstacles as well as several other needs that can clog DCA, stop for 1 week or one month, I have experienced that.

Yes, how much is the best for Dollar Cost Average they have their own way you can calculate it here : https://dcabtc.com/

noormcs5

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Quote from: Stepstowealth on January 25, 2023, 12:52:08 PM

I have searched and seen that;

Quote

Dollar-cost averaging is the practice of systematically investing equal amounts of money at regular intervals, regardless of the price of a security.

What is your best strategy for Dollar Cost Averaging, do you do it weekly, monthly?
What do you advice and why?

https://www.investopedia.com/terms/d/dollarcostaveraging.asp

It depends upon how much money do you have and how much do you want to invest in the DCA of bitcoin. You can buy each week or each month and do not think about the price. If you see the price, you will not be ale to do DCA as you always think that you are buying too low or too high.

I will prefer monthly DCA on 1st of every month. Make sure, you keep buying bitcoin periodically and keep on accumulating bitcoin at all prices.

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