Topic: Buy the DIP, and HODL! - page 403. (Read 108308 times)

We can determine the amount that can be allocated for DCA needs based on weekly or monthly income, at least an investment allocation of $30-50 can be reached by all economic classes for the lowest amount to realize the DCA strategy per week. We must consistently carry out the DCA strategy until we reach the planned investment target, if we set a target of investing $2.6k in bitcoin every year, so the calculation is that every week we have to invest $50 for 52 weeks.

We need at least 2 years to more optimally assess the progress of investment performance, because the DCA strategy is different from instant investments of large amounts, I think DCA investments are like savings for the long term and DCA investment options are very appropriate for converting to bitcoin, even though the market movement category is the highest but Bitcoin price can reach ATH every time after the halving period or more or less within 5 years, I quoted in another thread which stated that who would have thought that we could buy an iPhone 15 with just 0.03 BTC, imagine if you implemented DCA since 2015 then the investment performance progress would be very profitable.

Certainly, I can't predict the future, but I can anticipate what might occur. While it's crucial to pay off debt, it could take me a decade or even longer to accumulate the same amount of Bitcoin that I could acquire in just 2 to 3 years. It's also a good idea to have some cash on hand, but a better idea investing in a Trezor and Dcaing.


The perspectives you mentioned are focused on the long term, and indeed, patience is essential. I realize now that I've been placing significant importance on my emergency fund, which I intended to keep, but I had considered using it to buy Bitcoin for various reasons. I think I might not have reconsidered this if it weren't for your viewpoint and Agbamoni's input. I appreciate it! It's valuable to listen to different perspectives and opposing arguments; that's how we broaden our understanding.

It seems that you are getting DCA mixed up with other kinds of investing (such as lump sum investing), because DCA overcomes each of those items in your list because once you get started, then DCA makes it easy to overcome each of the items, because all you need to do is pick an amount.. $100 per week set it and forget it..... and if you think that $100 per week would cramp your lifestyle too much, a different amount could be chosen.

Of course, there is a need to both set up the DCA and there is a need to figure out what the amount is going to be, but there are ways to do minimal levels of work.. and then just let the investment strategy ride for several years, and sure maybe after a few years, there might be some needs to look at how the investment is doing and then to reassess whether further actions might be needed, and if the amount is starting to add up to a lot, then having stake in the game may well motivate further activism in regards to the investment.

As nothing is actually ever simple in this world to do especially when it comes to field of financial stability same thing applies to actually successful holding your Bitcoin and it's another case if you are accumulating through DCA, why? Well because it's not an easy task and most people actually just give up at the long run of it because of so many reasons and here are some.
---lack of discipline
---wrong financial income or none at all
---No proper planning
--- procrastination
--- impatient
Before anyone can properly practice DCA and still hold on to their investment for a long period these certain barriers are to be broken.

Part of the asymmetric upside nature of bitcoin means that you do not necessarily have to invest a lot in order to potentially profit a lot, which likely means that you should invest reasonably and try NOT to lose your bitcoin over time, and you can choose your own level of aggressiveness that you choose to be in accordance with your BTC allocation/investment amounts.


Each person has to figure out his own allocation, and I use $10 to $100 per week as an example of an amount that could work in order to attempt to make progress, but in the end, if someone is figuring out how much money s/he has available for investing, and s/he might consider that putting aside 10% for bitcoin investing, then it could take 10 years to invest 1 years worth of salary, and at the same time, whether that investment grows or not over the 10 years might help to inform such person about whether s/he is investing aggressively enough or whether s/he is allocating to the right kinds of assets, whether bitcoin or other assets or other ways of managing his/her investment portfolio.


Usually the standards for emergency fund would be 3-6 months, and there could be separate kinds of buckets for various kinds of expenses, but emergency fund is something that is not really expected too.. of course, you could go up to a year, but that might be a bit too much.. depending on your circumstances.  

Another thing is projecting out your cashflow and expenses, and you can go out 18-24 months or longer, but how far you go out may well relate to how complicated your cashflow expectations, yet the cashflow versus expenses of the next few months are still going to be much more important to have good understandings about as compared to those that go out further.

I remembered someone commented on this thread that he is using DCA to buy and at this same time, he setup some funds for buying at what he considers as dip... I guess that is what @snowpega is doing. Like you said, anyone following this approach should be prepared not to beat himself up if Bitcoin price did not follow through as they expected.  

By Newton's Law of physics, a body will continue in it's state of rest or uniform motion unless it is acted upon by external force. This law of inertia also apply to humans in a way. Some people will continue to expect dips and further dips until there is an obvious sustained bullish regime. This is how some people are wired. I do not consider this a defect rather, I see it as a demonstration of our uniqueness.  So, even though it may not seem realistic to you there are those who are convinced that price will dip further irrespective of it being oversold or not. What I have described is not peculiar to newbies, there are conservative old hands who still display this tendencies.  

Being a wise investor can be challenging because our natural instincts often lead us astray. It's essential to control our impulses and emotions. Typically, the best investors do things differently from the majority, which is quite tough. Even though many Bitcoin enthusiasts already do things differently, I believe our approach, staying calm and collected, aligns with what you mentioned – being intelligent when acquiring Bitcoin, doing so with careful thought and wisdom.

Absolutely, correct

Of course I will see how much my aggressiveness towards bitcoin will be in accordance with what I need, but I do not want to be excessive pressure, when this week/month is not able to enter fiat into BTC then I will stop for a while after returning to normal I will continue again, actually this is not about how much bitcoin is obtained, but my thought is how long will this be consistent? Could it be years? I will maintain while there is still income that I get.

Western countries and Asian countries are clearly different (that I know) Asia can be said to be quite low income but by putting fiat into bitcoin around $15 / $20 it is more than enough not to mention they can increase it to $50 but I think for $100 per week this will be too heavy to say it is not my capacity to meet excessive targets, I will be more on a small nominal will remain stable every week.

Well of course there is no guarantee at all that bitcoin will perform well, even the price can go down because there is volatility in the market, but we believe that BTC assets are important, and always read the history of bitcoin that it is likely to go up.

The guarantee of a monthly cash inflow gives us ease of mind. We can think clearly because we don't need to think about our monthly expenses. Saving a portion of our wages and investing them for long-term growth gives us confidence about our future, and we think of ourselves as cleavers and long-term visionaries. When things turn against them, they think of themselves as stupid; this is human nature.

Not to use your investment (in bitcoin) when emergencies arise is a strong statement but not a practical one. When people don't have money to cover emergency expenses, they tend to sell their assets. If you are investing in bitcoin as a retirement plan, then you should not sell it, but in times of emergency, your senses will tell you to sell it.

I'd say you hold onto your emergency fund and start investing what you can into Bitcoin using a Dollar-Cost Averaging (DCA) plan. It's VERY IMPORTANT to have an emergency fund, Kodec and JJG explained it well. You already have enough money to cover a year's worth of mortgage, food, and gas, which is essential for times like these. I personally wouldn't take the risk, and I advise you not to either. Speculating on whether Bitcoin will increase by 100X after the next halving is uncertain. It's better to pay off your debt first and then invest what's left. Your mental well-being will benefit from this approach. As many others suggest, stick to your DCA strategy.

If Bitcoin does what we all expect (based on our speculation), would it be foolish not to put a large portion of this savings into Bitcoin? In spite of raging inflation, my gut feeling is that an emergency fund is always prudent, as much as losing that purchasing power sucks.

Very Sage Words well i think words you have mentioned here hits kinda different to me these words motivated me alot like as you said cashflow give confidence which is so accurate like this is also what i have experienced in my life. I remember when i had no money i was very demotivated like i used to talk people like those talks were very strange and demovited so when i started to earn money like i used to talk people very energetically and motivatedly.TBH these all are not about just money this is the true aspect of life that cashflow give you alot of confidence like i believe if you are rich whatever you say if it is shit people will also appreciate you on that why? Because this is not you who he talking at this time this is the the status you have build which they are seeing and giving you respect.

I would say at the start of this paragraph you said if we don't have much availability to invest that little amount that you have mentioned like 10$ to 100$ so this is not good time to invest this time is to be groom and come to that point we have enough potential to do investment which is we have as our savings and besides those saving we have enough amount to spend and fulfil our desires in that way we would be able to accumulate very well Amount of Btc.

Those Btc will not be extract as emergency position we will be able to extract those BTC only When we reach the Fix goal we have fixed in our minds So i think it is going to be a good idea

I don't think that anyone should feel bad about taking a long time to build up a significant stash of BTC or even any kind of investment that they make, and I had already mentioned that many people are likely going to take longer than 10 years to merely get up to having had accumulated 1 year's salary (even if you save/invest 10% of your income per year).

Accordingly, the earliest of years likely feel like you are not getting anywhere and they can be stressful, especially if you might feel that you are struggling to make sure that you invest enough and while at the same time not overdoing it and fucking things up so that you end up losing everything that you invested.  A lot of people fuck up so much that they end up gambling rather than investing, and with gambling, there might be a lot of luck until one day the market moves against you, and you are fucked (having to start over from the beginning is not a good place to be if you had been spending 3-8 years building up your investment portfolio and then if you take too many chances, then you end up losing your principle which tends to be quite difficult to build back.

Even older (or longer term) investors sometimes will feel that their investment portfolio is not moving, but if they ar not fucking up too much, they can look back at their history and they can see that their networth and their portfolio is growing with the passage of time (hopefully that is the case).


You should not rush beyond your capabilities, so if you are having trouble investing between $10 to $100 per week, then maybe you either have to figure out ways to increase your cashflow or to decrease your expenses.. and at the same time, of course continue to have a decently good sized emergency cushion so that you can have a large amount of confidence that you will never need to use your bitcoin for emergencies (in other words your bitcoin should not be part of what you believe to be your emergency fund.. because you should ONLY be selling your BTC at a time that is completely at your own choosing. not because you are forced into such position.. and perhaps forced into such position due to inadequate/insufficient planning).


I am surely not saying that any of this is easy because worse case scenarios can go lower than expected and they can also go longer than expected.. so once you are in the shitty situation, you might have to do things that you did not want to do or expect to do, but it still seems to be a lack of preparation in terms of preparing for worse case scenarios and even preparing a little beyond worse case scenarios.. and even more experienced investors (or persons who have built up greater levels of emergency funds and wealth) will sometimes get caught off guard by having their assets invested into things that they should not have had.

And, yeah for normie plebs, the situation could be even worse because normie plebs might well already NOT have hardly any financial (or psychological cushion), and hopefully learning how to invest helps you in order to figure out how much preparations you need to make... and there might be some people who never are recover from disasters that happen to them, and they may well be stuck being poor and impoverished forever.. so part of any attempt is to be able to get to a position that you are able to invest, and if your personal finances are so bad that you are so far under water that you do not have any discretionary income, then you have to take care of those emergencies first.. and get to a point in which you actually have discretionary income that you are able to invest.. and perhaps build up your emergency funds at the same time.


Surely there is some discretion in terms of whether you should use up the whole $200 to $300 during the weeks that it comes in, especially if you might have several weeks in which it does not come in, and maybe you can kind of anticipate how often your jobs are going to be steady and how often you are going to need to float upon your past wages.

I don't know the exact answer, but there does seem to be some potential value towards spreading out your amounts rather than investing them right away when the come in, so that you always have some amount available that you could spend on bitcoin buys.

So it could be possible that you set up $50 to $100 per week no matter what, and if your income for some of those weeks end up being higher, you put that into your reserve funds.. so that you are able to go a certain amount of time with out having any extra funds, and if you feel that you should have your reserve fund prepared for 10 weeks of having to draw from it, then maybe you have to let it build up to $1,000 before you go beyond the $50 to $100 per week allotment... so then if your reserve fund ends up staying above $1k for a long time, then maybe you are then able to increase your weekly to $150 or some other higher amount.   Of course, these are discretionary matters in terms of whether you believe that you are served very well from just spending it right away or trying to be a bit more strategic about your bitcoin purchases (which may or may not be a valuable use of your time).


Yep.  We have to be careful when we are dipping into funds that have already been set aside for other purposes, and so there may or may not be strict guidelines on these kinds of discretionary matters, but if we end up depleting too many funds without really appreciating what they were meant for and we have assigned shitty probabilities in regards to things that could happen, we may well end up recking ourselves if we go too far with some of these dipping into funds matters.

I personally tend to think that none of these matters are absolutes, but there may be thresholds over which guys (and gal) end up crossing that really don't come off as being either prudent or reasonable, and then they end up getting themselves into a pickle because they left their emergency fund with $300 and a truly foreseeable $1k expense ends up coming up (which negative outcomes ends up showing them that they were engaging in too much gambling, and maybe it had been working out for them in the past, but this time, they got bit in the ass) and they may put themselves into a pickle that could take them 6 months to a year to recover, when they would not have had been damaged at all if they had kept their emergency fund up to a sufficient size/amount.

To be real about this, using part of  emergency fund is not even advisable... You not guaranteed on the expenses of any emergency to happen at any point in time
Funds meant for emergency should be kept completely different, same goes to funds for Dcaing

yeah i was still aspecting to see more declines in the market as We all know CPI reports , and FTX decision came from court was to start selling their assets so that's why i was aspected that market will go down but very now you have mentioned me btc goes up and set it price to 27k$ which i think really don't know what's going on we can't time the market right. Now what is have experiences all these kinda news are just to liquidate small investors in the markets and bigwhale plays their game. so now what i am thinking to buy more amount of btc at 27k$ as i don't aspect very much from market it is also good price to buy some more.


well i think kinda sage words and i would say many thanks for your opinion to me about the modification in the strategy of DCA'ing.   i think 27k is still good time for me to go ahead i was just doing DCA in the way to buy only dips whch i think also good aspect but somehow your points still relate like we always should not for dips to buy well thanks for you appreciation.


Many thanks to you as well as i learned from your words  that never hope alot from market like always wait for the dips to buy now i have made some modification to my knowledge to buy at current lower price rather than aspecting for the dipper one as we don't know what is going to happen or next move of market yeah all we can do is FA and TA to know the market behaviour and have some prediction of future and which can't be 100% accurate right?

 

DCA with emergency fund to me sound more convincing and easy to do more than setting aside a percentage from your total income on weekly basis,  since emergency funds can also be referred to as leftover money which will be more profitable when saved in an assets that are easily converted to cash like BTC,  and from what both of you guys already mentioned,  it quite clear that emergence will be the best since in both worst cast scenario and best case scenario if you have a well planned DCA approach you will still end in a good position,  since at that point you are not  depending on your income to make your investment but rather you are buying Bitcoin from your emergence savings.


But the only side to watch out in all of this is,  you must be smart enough not to exust all your emergency saving on buying the dip and in most cases you must at least leave a small portion of the savings behind so that when you have a real life emergency,  you will have the funds to sort them out.


That way,  the pressure won't be on you bitcoin holding at once and that can allow you to bear market conditions for some time based on long term Bitcoin approach.

Expecting a continuous price decline like that is also not very good after you have succeeded in getting Bitcoin at low prices twice in your previous purchases. Today Bitcoin has re-positioned itself at a price of $27K and you should be able to smile a little because you can immediately see profits in your portfolio without having to wait any longer, but my advice is to continue holding it until you see the price double the current price so that you can feel true happiness through Bitcoin.

The DCA strategy that you are doing has really worked very well and I think you also really understand it so that you can continue to use it in the future when you have money saved that you don't use for other things. And the price increase seen now is also not a bad phenomenon for you, even though you still want to buy Bitcoin under $25K, but for now look at the profits you have made so that your confidence in Bitcoin can continue to grow.

JJG, I know that you are an old G bitcoin holder with so much experience and different strategy on how to accumulate bitcoin. I also agree to what you said on how someone that isn't having a steady cash inflow can use his average cash inflow for the year to plan on how much he will use on DCAing or to always have an amount that will be left based on always planning and keeping funds for worst scenario than average case scenario. I wouldn't like to such happen in my own bitcoin journey accumulation, the reason is that I have just started my bitcoin journey and I haven't accumulate a significant amount which I can be proud of. Not having regular cash inflow will be a big challenge to me because it will slow the amount of bitcoin I will accumulate, and I am not even sure of accumulate, unlike the regular cash inflow pattern. This is because you might prepare and plan very well on this, but along the line, it might come to play that your worst scenario expectation came out to be  more than what you have planned for, because there are unforeseen challenges that will come to play during this period, which you didn't plan for that must be included because of it is an emergency.

I will use myself as a case study, I plan on how much I spend weekly and let me say if I budgeted $200, I will end up spending up $250 and sometimes $300, but because I have a steady cash inflow I don't feel it. I could remember when I have not gotten job that was frequently paying me, I find it difficult to manage the one that I have worked to use till when another funds comes in, because of this unforeseen circumstances that do occur. I am happy JJG, that you said if you did not make a proper calculation so that your worst case scenario funds should be higher, one might end up falling back to sell his bitcoin due to lack of proper preparation. I am not good at managing a certain amount of funds for some time before another funds comes in because, nobody knows what will happen next, this is why I feel that regular income will help in DCAing better for me. Although, everyone has their own strategy of DCA base on the way they get their income.

I think that whether 10 years investing into bitcoin is enough depends upon from where you are starting.  When I got into bitcoin, in 2013, I already had 20 years of investing into traditional markets, so then my bitcoin holdings became a supplement (or even a hedge) to my other investments that included equities, property, bonds, cash (or cash equivalents) and some exposure to commodities, even though bitcoin largely became my main commodity exposure since my investments were relatively weak in the commodity arena.

I doubt that it is smart for anyone to be thinking that they are getting in and out of bitcoin, since bitcoin seems to be a life time investment, even though there may be ways to manage (and maintain) your bitcoin holdings once you reach a level of BTC holdings that satisfy you, whether that is 2-5x your annual income (expenses) or maybe it is a higher amount while keeping in mind that if you get to 20x to 30x of your annual income in your investment portfolio, then you are likely getting into entry-level fuck you status, but the mere fact that you might be getting into entry-level fuck you status should not mean that you sell all of your various holdings rather than manage them and maybe even figure out ways to start spending them, if you are at that stage of your life when your investment portfolio starts to get into entry-level fuck you status... sure there are some people that will still want to continue to grow their investments, and age (and maybe family status) would surely factor into those kinds of considerations.


Putting the DCA method into practice and applying it to your own circumstances seems to be the real test of both understanding it theoretically and personally experiencing it in such a way that you tweak it and tailor it to your own personal circumstances.


That's up to you regarding how aggressive that you feel that you need to be for your own circumstances.  I know that between 2014 or so and 2020, I largely just recommended that guys get off zero and invest $10 per week into bitcoin; however, it seems that in order to even get comparable results, people in the west should be trying to get to $100 per week. and sure some folks could even do more, but $100 per week seems to be sufficiently aggressive without necessarily overdoing it for normies in the west.. but if you are not in the west and you are already starting with $12-$25 per week, you have to figure out your own level of aggressiveness and whether you believe that investing into bitcoin is a good use of your cash for you... especially since there are no guarantees that BTC will perform well.. so hopefully you are not depriving yourself too much.. . but again, those are your balancing choices.


One of the good things about spreadsheets is that you do not necessarily need to keep the funds in separate wallets (or separate accounts within a wallet) in order to keep track of different purchases that you had made - even though as you suggested, there might be a little more ease to keep track if the funds are separate.

I have used spreadsheets in a variety of ways to keep track of purchases, but also to project out various kinds of BTC price performance scenarios and to see how my behaviors might impact my BTC holdings if certain BTC price scenarios were to play out (so long as I followed the plan).  

At one point, in mid-to late 2015, I had divided my BTC into at least three overlapping categories in order to guid myself in terms of how to treat my BTC holdings, so there can be some fun (and practicality) in that.  The categories were:

1)  all of the BTC that I bought from late 2014 until then (mid-2015) (average cost of $250 ish)

2)  all of the BTC that I bought from June 2014 until then (mid-2015) (average cost of $330 ish)

3) all of the BTC that I bought from the beginning late 2013 until then (mid-2015) (average cost of $520 ish)

These were moving targets, but they guided me in terms of my own authorizing myself for what I could do.  The categories were overlapping due to my own reasons, yet there could be reason like you suggested to categorize the BTC in other ways including trying to figure out if average cost per BTC ended up being affected in any meaningful and substantial ways based on my own employment of various different kinds of BTC accumulation strategies.  I am not sure how important that question is, except maybe to guide you if you believe it might contribute to your changing your BTC accumulation strategies (or what you recommend others to do) based on your own results.


I don't really like the idea of buying daily if you are not buying very much, unless you are able to buy without much if any fees.  Sometimes, you could have a cash account that builds up and then you send it to the exchange once a month or so, but also you have cash on the exchange that you would use so that you are not having to continue to submit small amounts.. and of course, some of the concerns about fees and/or sending a lot of small transactions (or attempting to minimize that) might have to do with personal circumstances, and I do recall that between 2013 and 2015 I was able to find ways in which I hardly paid any fees for a lot of my BTC purchases, but then sometimes the no fee options disappeared and sometimes it may be better to spend the fees, so for example if you are able to have fees that are truly just based on percentages, then it may well not matter very much if you buy $5 at a time or $100 at at time, because the purchases are percentage based... so then in those circumstances, you may well be o.k to engage in BTC purchases as soon as your cash comes in, even if you have small amounts coming in at each time (daily or even hourly making determinations how much to hold and when to wait to make purchases, whether to market buy or to set a limited buy order that might have lower fees than market buying usually has higher fees than the limited order fees.)

Ps.  I realized one point that I left out is in regards to having a whole lot of small UTXOs, and that can become problematic, so sometimes if you are buying small amounts and then moving them off of the exchange too early, then you will end up with a whole hell of a lot of small UTXOs, and sure maybe it is not necessary to combine your UTXOs, and I can remember in 2014-2016, many times people would be talking in terms of having 1-10 BTC in each UTXO, and now days, that seems like way too much money to have in each UTXO, so the ongoing questions regarding how much value to keep in each UTXO will likely vary with the passage of time, and sometimes a $100 to $500 UTXO might end up going up in value by 10x or even 50x by the time you  spend it, so at that time, the UTXO will not necessarily continue to seem to be too small.

I will admit that I have made some mistakes with UTXO management, and it is not necessarily easy to know in advance what might be good (reasonable/practical) amounts of  value to keep in each UTXO and whether there may or may not be value in terms of combining (or keeping separate) some UTXO from other kinds of UTXOs, and one of the things that I had started to do was to attempt to keep similar kinds of transactions in the same wallet (or account) even though I might still keep the UTXOs (or the bitcoin addresses) separate within the accounts, but one account might end up having 10 or more UTXOs and I try to keep track of from where they came but there can be burdens with these kinds of things including questions about whether someone might see labels that you might put on them... and then ruin some of your privacy.

You can do it when you are really ready to do it. Just like this, just put your level of confidence in Bitcoin first, because if you can't control your lust for the profits that come your way, then you are not ready to enter the long-term investment zone like JJG did. I see almost everyone doing DCA for their long term investments but they don't have a strong mentality to hold it in the long term because they exit when they are already making a profit.

I think you have to learn step by step first to prepare yourself mentally for long-term investment. DCA really supports you in accumulating BTC in each Quartel if you make purchases in each Quartel, but you have to have a level of confidence in the long term early. So with what you said it seems like you are still waiting for your salary from your office to buy BTC. of ​​course that is a pretty good decision and I think do it based on the percentage that you have, divided into your financial interests for living needs and for investing in Bitcoin.