Topic: Buy the DIP, and HODL! - page 401. (Read 108308 times)

I was impressed by your statement above "keep buying BTC and revalue your position in 3-5 years from now" and yes. I think the DCA investment model should continue. Well, I want to know. Can Bitcoin get back $34,000 by the end of September 2023?

Looks like gobble-dee-gook to me.  If you have a long investment time horizon, then just keep buying BTC and reassess where you are at 3-5 years from now.  If we go by your forum registration date, you have already been in BTC for a bit more than a year, so maybe you have been able to accumulate some BTC during that time, and maybe you are not yet in profits, but whether you continue to accumulate more or not has to do with your own situation in terms of how many BTC you have already accumulated and what the rest of your personal circumstances look like...

trying to figure out what might or might happens in the market in the short-term is another question that may not really matter too much, including nonsense discussions of sentiment.  You really are likely to get yourself into trouble if you are trying to figure out what to do based on market sentiments rather than just having some kind of a solid plan that is based on your own finances and psychology rather than giving very many shits about how the other people in the market might feel about bitcoin.

Emergency funds for some of them are not to be taken to invest, but rather emergency funds for their living needs when they are pressed by a disaster that occurs, be it a flood, earthquake or the death of a relative. So they can use the emergency funds for that, instead of selling  assets/bitcoins they own. In fact, what you explained is not wrong, but the term might be better used as cushion funds or reserve assets that they can take so they don't miss the stage of their purchase.

After everything has been successfully adjusted to good planning, of course long-term investments can run according to their plans because they have managed their financial levels without disrupting the course of their investments. We have even heard that they often sell their BTC holdings due to pressure from the situation they are experiencing, so this is where emergency funding arises that must be considered.

Your explanation certainly makes sense because applying the DCA strategy of course you don't have to be skilled at reading charts because you make purchases at every stage when you start. DCA is the most admired strategy for those making long-term investments, either for the next 10 years or 20 years. But basically when there is a question from someone from your relative why you buy at a high price when you can wait to buy at a low price (well in this perception you can give an answer if I will calculate the average purchase entry when I reach the peak to exit at  in the next 10 years) it will make them amazed by your answer.

Well, at the level of adjusting the emergency fund, this is not very important for some people because if they get a weekly income they will adjust the percentage level they will use in Bitcoin investment, even so it will be in line with their concept without any obstacles that can hinder them. On the other hand, if your income does not determine where you pursue odd jobs (sometimes you work or not) of course the level of adjustment for emergency funds is quite necessary so that you don't miss a purchase step. Well, emergency funds are of course prioritized to cover gaps when you don't get income at that time, so you can use emergency funds at that time. Isn't it like that?

Of course that is the most convenient way at the moment but in the future I will readjust how to distribute the budget more evenly and larger on bitcoin investment, as I said I want to increase the strong fund first so that it is safer and stronger for a few months the rest can focus on bitcoin defensively by increasing the DCA.

I believe many of them do that such as 30% bitcoin investment 10% emergency fund the rest of the needs to cover a month, for now it should be more adjusted again and strategize a good budget over the long term for bitcoin investment.

Isn't it for the DCA strategy to walk all the way to not need to think about market sentiment? Because in my opinion this is only temporary while DCA is long-term which continues to run every week.

Even for now I don't need any chart analysis with DCA purchases when the money is ready then I buy no matter what the price is because DCA is buying at an dollar cost average.

Hmm, with that I think they need to learn how far their DCA is moving effectively with the market sentiments I'm saying that this month was a great opportunity for those who involve themselves in accumulation with DCA. As far as this month's sentiments really improved the outcome of DCA the investors need to realize that while getting involved in DCA are they really meeting the market sentiments.

Have a look at the market scenarios, I've gotten this a day before.. Seems like it can perfectly fit in the recent market sentiments.

You should not be presuming that the same kinds of balances are going to need to be in place for all investors, and sure when you start out investing you are going to be in a certain place in which you hardly have anything to add up that is in your investment portfolio, yet sometime between 3-10 years investing (whether in bitcoin or any other thing), you may well start to get to or to exceed 1 year's income (living costs) inside of your investment portfolio.  A lot of investment and cash management advisors, will suggest somewhere in the ballpark of 6 months income (living expenses) as an emergency fund, and personally, I am not so strict on such a rule or such an emergency fund being maintained at all times, even though I do believe that 6 months is a pretty decent guideline regarding how to think about how any of us might deal with a variety of scenarios that might come our way in which we are going to need liquidity (or cash/value to be available in our local currency).

If we set some standards for ourselves, we should be trying to consider why we are setting such standards and also to consciously realize the extent to which we are deviating from such standard or if it might not be a good idea to deviate from the standard if we are not sure why it exists, so sometimes we do end up having to experience a variety of scenarios in order for the importance of certain practices start to make more sense - and it could be that if we take a real whimpy and/or conservative approach towards investing into bitcoin, such as $10 per week when our budget would allow $100-200 per week, then we might not have to worry about any of the bitcoin related matters because they are relatively a smaller amount of our budget, but then if the price of BTC ends up going up faster and/or higher than our other investments, we might start to realize that there were real world consequences that ended up playing out and perhaps causing us some regrets regarding choices that we made earlier in our lives and we are unable to turn back the clock for some of our decisions, even if we may well have been truly and sincerely convinced that we were doing the thing that was best for our current self and our future self, but we ended up being wrong.


Yes, but none of us are going to know for sure if we are going to be happy with the results.  We might believe that we are happy with what we are doing, but we are also not going to really know the results, so we just have to do our best, and some of us will end up being more correct than others in terms of reaching a balance that works for us in the short term, in the process of the investment, and later when it comes time to start to reap the fruit of our earlier investments and our investment strategies, if any.


Well, you may well have to make a lot of adjustments along the way, but sure there is no problem making a plan and then trying to stick with it, but you might have to tweak such plan at various points. .and you will likely become more informed about your plan as you see results and if the results end up deviating somewhat from your base-case projections.

Let's say that you started investing in BTC around 10 years ago, so at the time that you got started in bitcoin you already had around a $100k investment portfolio, and you wanted to bring bitcoin up to about 10% of that portfolio. so you more or less want to get up to 10% and then thereafter to reassess.. And so if you start to invest $100 per week into bitcoin, then it is going to take you around 2 years or perhaps a bit more to get to 10%, but then if the bitcoin and the other assets perform differently, then it could end up contributing towards your reconsideration of the matter. .. your overall assessment is that you realize that bitcoin could perform better than the rest of your portfolio, but it might not, so you are merely just expecting around the same results as your overall investment portfolio, which had been around 6% per year on average.

So if you  had invested around $10k into bitcoin  (at $100 per week) starting from early 2014, then you may well have ended up accumulating right around 30 BTC.

So you might reassess and then decide to go 1 more year with the $100 per week into bitcoin, even though it is going to take you higher than 10%... so then  after 3 years investing into BTC at $100 per week, you may well have gotten to right around 40 BTC, so you may well be faced with questions regarding how to proceed.. and I am not going to say that I really know the answer because each person is likely going to need to reassess based on his her own situation about how to proceed when such surprise (or somewhat surprise) results end up playing out.

I am not sure of the resolution that each person is going to make regarding how to treat their bitcoin investment because if they had invested in bitcoin for a bit more than 2 years at $100 per week, they might have been right around 10% invested by the time early 2016 comes, but then then by the time we get to late 2016, they might be getting to 13% or so invested into BTC, which is more than their 10% expectations or maybe they maintain their allocation to keep it at 10% as compared to their other investments, but still they end up being faced with the BTC prices shooting up around 40x between late 2016 and late 2017, if we use $500 as the base price.

There may well be some needs to reassess whether continuing to DCA is a good strategy or if some other kind of an approach towards BTC accumulation might become more practical.

I personally don't really like the idea of reallocation, but if you are not very diversified, then you may well need to think about reallocation, even though letting your winners ride might also be a good approach as long as you are comfortable with your various other investments as compared with bitcoin, because sometimes when the price of one asset disproportionately goes up as compared with other investment, there are needs to assess what are your other investments and are you comfortable to keep so much of your netwealth in an asset that just went shooting up so much rather than shaving some off.. even though we are not really talking about those kinds of matters in this thread.


I don't really disagree with any of these last assessments of yours even though you are kind of crossing over the definitions of DCA, buying on dips and lump sum, and in practice they do frequently end up crossing over depending on how they are deployed.


The risk in bitcoin is not 50/50, even though short-term price moves could be 50/50, but if you are investing into bitcoin over 4-10 years or even longer than that 20-30 years, the risk is not 50/50.

Sure you could lose all your money, but when you are investing money in the long term, you are not investing with money that you need in the short term to cover your expenses, and even if you might end up with a shorter investment time horizon of 4 years, then you still should not be thinking about the short-term price moves.

Of course, you can choose to treat bitcoin however you like and get in however you like, but the thrust of the ideas of this thread is long term investing, which I personally would consider to be a minimum of 4 years from the time of any amount that you put in or any time that you add more value, it is still 4 years from the time of the new value, not from the time that you started.


FTFY  

It seems that I agree with everything you said as long as you are talking about bitcoin, which is the subject of this thread.

We are not talking about "crypto" here... in fact fuck crypto.. including that it is not likely that a lot of the principles of long term investing, buying on the dip and DCA do not really apply to crypto or shitcoins..,.

you gotta be careful if you try to apply these same presumptions of fundamental value to projects that may or may not have fundamental value, so you better spend some time figuring it out, otherwise you are going to be applying different kinds of considerations including in and out considerations...  

Anyhow, if you meant to talk about bitcoin, it seems pretty strange that you use such a vague, meaningless and dumbass word, and you've done it more than once.. .. hopefully, you learn how to use the term bitcoin, if you are talking about bitcoin, and if you happen to be talking about something else, you likely need to explain what it is that you are talking about rather than speaking in gobble-dee-gook and meaningless language... and there would be no excuse to say, everyone else does.. .. if that is what some members here might be thinking.. so what if other people speak in retarded language? We are talking about bitcoin here. so hopefully we are not using retarded terms without at least having a context for why we are using such terms.


Hopefully, emergencies are not happening very frequently.

Don't get your emergency funds mixed up with the likelihood that some of your incoming cashflow and your expenses vary.  The variance of your cashflow versus your expenses should not be an emergency because you can project out those kinds of matters and put them within a range.  Emergencies might not happen for many years, but if you engage in sloppy practices of projecting out your cashflow and your expenses, then perhaps emergencies are happening way more frequently than they should be.


I like these kinds of categories, yet there is still a difference in regards to how much to allocate towards something for each paycheck, but if the emergency fund is not being used, then it does not need to be allocated into, except if such emergency fund is getting rebuilt from having had been depleted... so when you are describing the 20% for emergency fund, you are likely just referring to something like an expectation that you might have about variance in your expenses versus your income..,. so there is difference between a variance in your income versus expenses and the replenishing of an emergency fund... even though there could be cases that might be drawn out for a decent amount of time that might amount to replenishment of a depleted emergency fund...and some members have already suggested that an emergency funds should not be touched at all, except for the purpose that they are proscribed.  I am not 100% in agreement with that view, but I surely have a lot of sympathy for that kind of a conservative and self-imposed disciplined approach.

Yeah, it's a good approach. Normally, it's a wise idea for someone to make a budget on how to spend their salary; otherwise, they may end up spending all their salary and not still be able to satisfy all their needs for that month. Even if the person is not investing in any asset, they can roughly spend all their earnings on personal needs and still might not be able to keep some funds for emergencies. Which is why It is good to always have a budget design for how you will allocate your salary and what you want for that month, and while doing so, you should know how much you need to fulfill your needs, which should be able to serve you till the next month that you will receive your next salary, how much to put in your emergency fund, and how much you can invest in bitcoin. A good budget might help you to even spend less and help you to be contained with what you have until you receive your next payment.



Do it in the way that is best comfortable for you, depending on how much you earn every week or month. Everybody's salary varies; some people can put more money into their bitcoin investment and only put less money into their emergency funds, and yet they will not be affected in any way; they will still have their needs contained until they receive their next salary and work out the new budget they also have for that month.

Some people can even invest 30% of their salary in bitcoin, 50% in their needs and bills for that month, and 20% in emergency funds, but that still depends on how much the person is earning.

It is good that you already know how important it is to keep emergency funds. Investing all of your salary in Bitcoin is not advisable because you can easily sell your coins when matters arise, so as you are investing some of your salary, you should also save some for emergency issues.
It is good to accumulate more BTC, but your accumulating strategy should be in a proper way. Although it is not a bad idea as you are using the DCA method to accumulate, you should also save funds for emergencies. An emergency can occur any moment, so it is good to get prepared for it so that when it comes you will not think about selling your coins.

Some people who don't save up for emergencies use the coins that they have accumulated for months or even years to sort out solutions to their emergency problems and, after they might have settled their emergency problems, they either start afresh to accumulate or they quit their investments, so instead of any of us to be in that category we should learn to save money for emergencies.

In Crypto, you are advised to invest what you can afford to loss.  That is the point and as a smart investor you should be able to have a budget and plan of investment so as not to be in a situation whereby you will have to start looking for where to go borrow from to sustain yourself.  Always set out small portion of your income that you know would not bother you if you invest in them.

Emergency can happen at any time and when it happens, it always requires urgent attention to resolving it. In  that case one would need to fall back to their investment  to sort themselves out. When this occurs, you will have to acknowledge the fact that investments are much worth it. Investment to me sometimes is a back up plan otherwise what is the investment there for if I can not be able to use it for myself when the need arises.

I am trying to gather fact on what you said here.
Do you mean funds can be used to invest in Bitcoin, just to keep as emergency fund? Or you mean at a point of emergency the best option to resolve problems is by tampering ones investment.
I do not think it necessary to invest your emergency fund in Bitcoin, because you are not yet into sorting out any issue at that moment and you feel using the money to invest is the best. The rate of Volatility in Bitcoin is high and you are placing yourself at a 50:50 risk. I believe it is not advisable.

I also think there are better option when your emergency fund can't meet up with challenges at the time instead of tampering with your investment. A loan can be collected from Family, Freinds or any Financial services but not your investment

Lack of preparation is what will make an investor have problems on what fraction from his income that he will assign for regular DCA. It is not a healthy practice for one to equate his emergency funds and investment funds, especially when you are investing in bitcoin. It is only someone that lives where everything is provided for him, that is when you can think like that because you have less expenses, but still you will need an emergency funds to take care of some personal things, like if you have a girlfriend, going to have fun and so on.

 It is expected that our emergency funds should be higher than thye one that we are investing so that they will be no ugly suituation that will make you go and sell from your bitcoin that you are buying, this shows that you are ready to continue using your DCA pattern to keep on accumulating till you get to your bitcoin target. We need cash to survive and we need our investment to grow for a better life in the nearest future or at old age, this is why there must always be a reserve of emergency funds to take care of whatever should be taken care on, your investment can keep on growing as you keeping on DCAing.

I understand what you mean, because as long as you are happy with how you invested your money in bitcoin, and holding your long, you will be peaceful because you know that you will make good profit at the given period of time. What I see in the DCA pattern, is like you said the active buying of bitcoin, no matter how long it takes you to continue buying, maybe ten years or more. Another reason why I like the DCA method is that it create room for you to see reason why you need to increase your bitcoin portfolio from your initial bitcoin target because, you will become use to assigning a certain amount for regular DCAing, which will become part of your weekly, or monthly practice. DCA will also give you a proper insight of bitcoin market for you to come up with a strategy on how to be flexible with the market, irrespective of the price of bitcoin, as long as you keep on accumulating.

 For instance, an investor can come up with a DCA strategy, that if the price of bitcoin is at 20k-25k, he will use 20% for DCA, at 26k-30k, he will use 15% and at 30k up, he will use 10% and so on, because he has a fixed amount of money assigned for DCA. While people who buy at dip, don't have much practice in their buying, just only to follow news and keep on expecting for the dip, that they don't know when it will come, or the people that buy at lump will only buy once in a while based on when they have accumaulated enough cash that they feel it is time for them to buy again.

I completely agree with the notion that unexpected and unforeseen circumstances might arise, compelling you to address those issues first. However, these challenges shouldn't drive you to invest aggressively without thoroughly considering the nature of your investments. It would be unwise for any rational individual to let their emotions lead them into making hasty decisions driven by ignorance. Such a strategy poses an immediate threat to your financial health and could escalate into a other problems.

Some people might even think of taking loans to invest, hoping to recover the funds they spent on resolving these issues. While some may not appreciate the concept of low-volume accumulation, which involves not buying aggressively and focusing on risk control, I believe in the importance of maintaining an emergency fund, diversifying investments, and managing risk. Sure, I might envy those who took a reckless all-in approach if Bitcoin performs as we all hope, but I'll be OK and sleep better at night in the fact that I didn't ignore the nature of Bitcoin investment and went all in.

Truly money can resolve our urgent needs but in some cases when money is not available, the available should go in for it or possibly take the place of the money to solve the problem. Most times things happen that no one bargained for but you will have no option but to respond accordingly. These experiences are sometimes among the reasons one needs to invest. Irrespective of the nature of the investment, for instance, bitcoin that you have direct access to when you are in urgent need that requires a financial commitment and you have no cash at hand and in your account but you have crypto assets. It is expected of you to sort yourself out.  That is good because when you have enough to sustain yourself and more, you invest the excess so as to serve you when you are in urgent need and the investment as the case may generate income as time goes by.

Yeah even when using DCA method the pressure is still there but with a limited aggressiveness of accumulating but perhaps understanding the concept of DCA very well I don't  think you will be pressured using DCA method because you can only be presured when only focusing on accumulating without knowing there could be other serious needs that will arise and needs immediate attention and if perhaps you don't have emergency funds then you became presured and panicking, So is just like what Jay was saying that even with DCA method we can still end up overinvesting  and getting ourselves into the same pressure but if only we can accumulate with the plans of having an emergency reserved funds we can hardly be pressured.

Indeed, that is my current method, when I receive a weekly or monthly salary, I always make an allocation for Bitcoin, the amount specified, for example 10% or 20%, actually that is enough, the rest I can cover my other needs for a month.

It's too important to invest but not think about other things, even though it's a simple matter, when someone is consistent in investing in Bitcoin using the DCA strategy, for example, they will definitely make a fixed allocation when they receive a bonus from their salary, perhaps a little increase or it could also be increased. For me, an emergency fund is both important things too.

To make it more balanced, the 10% DCA bitcoin 15% emergency fund is the right allocation depending on how much salary you receive, but I have prepared both, including an emergency fund and consistent DCA.

Actually, I have prepared an emergency fund before but only covers 2 months, but I want to increase it to 6 months and then after that I will increase the bitcoin allocation more.

I don't really agree with this because basically when we talk about DCA I think the pressure is still there and one of the psychological factors about greed is still very big and of course we also have to have a big reference in consistency which I could call it a pressure that we have to be aware of.
But on the other hand DCA clearly makes us more comfortable in investing because we don't need to feel that we are burdened with the existing pressure and that's what makes me personally suggest DCA as one of the right strategies for us to live with, especially for beginners and people who have modest income.

This is well understood and thank you for the patience to explain this to me. From this discussion I have realised that DCA is just one part to it and that there are other ways to achieving the same result and all depends on what the person is comfortable with. The other point you made about active investors is also very correct.

In trading, there are day traders, swing traders(those that hold trade for couple of days) and position traders( those that hold for months and years). The category anyone belong to depends on what suit his personality. Now I understand personality also play key role in approach as regards to buying Bitcoin and investing in general.

Unfortunately,  it took me this long to realise it was a big mistake. Now that I know better, my approach will be different.

I do think that in many cases, DCA is going to help people who might have tendencies to try to overly time the market, but if they establish and aggressive DCA that uses near or all of the cash reserves every month without sufficiently creating an emergency fund they could get themselves into trouble.


That's not correct @adultcrypto.  Just because DCA has an ability to bring peace of mind, and less needs to worry about your investment, it does not completely remove the possibility that some people might still worry or that some other BTC investment strategy might bring them more peace of mind because it suits them better to be lump sum investing, buying on dips and/or whatever other strategies that they choose.    They may well need to be more active with their investment, and perhaps that is what you were aiming to say. .that DCA allows someone to be an active investor without having to be active... whereas some other strategies might take a bit more managing.. but not even that is completely true because there could be ways that someone is able to set up the parameters for whatever system that s/he follows that is even less worrisome for them (and even less active) than DCA. 

Lump sum buy bitcoin one time and then completely forget it for 20 years.. that's pretty inactive and it might even give that person a lot of peace of mind to just not think about bitcoin for 20 years or whatever might be his/her timeline.

Don't get me wrong.  I do think that DCA is the best for an overwhelming majority of normies.. but people are surely free to choose their own variation of systems and even truly/sincerely believe that it is better for them.. and perhaps they are correct in terms of their personality and/or their financial circumstances.


Fair enough.. and some people are not able to buy in bulk anyhow, and some people are able to buy in bulk, but they might find it to be more helpful to figure out a way to pace out their investment into bitcoin through some kind of a DCA approach.


Failing to sufficiently establish either an emergency fund and/or sufficient reserve funds for other kinds of regular expenses is an easy mistake to make.. .and sometimes you can see it in theory, but when it comes to practice, you might have to practice for a long time to be able to figure out the level of balance that works for your actual situation rather than what it looks like on paper.

Salahmu, as JJG has said, DCA would only help to manage the overinvesting temptation. Yeah, emphasizing DCA, it's either you already have a huge amount of money that is already set aside for bitcoin investing (example, $100k), but you don't just want to invest it at once because you feel the price will go down below what it is, and you start to invest using the DCA strategy. Secondly, if you are working for a monthly or weekly salary, you can also have an amount you always want to allocate to bitcoin, either weekly or monthly, at any time you get paid.

But I think overinvesting in bitcoin is also a simple problem you can avoid if you always have it repeating or if you want to prevent it from happening. The way I think it can be avoided is by having your budget planned so well, either before you receive your salary or after you have received your salary.

When you are close to receiving your salary or after you have received it, you just have to take your time and make a budget, and while doing so, never forget to also add some funds to emergency funds, then allocate the amount  you want into bitcoin.