Topic: Buy the DIP, and HODL! - page 559. (Read 135368 times)

So far I haven't been very strict about setting aside an emergency fund and I can tell you it's pretty flexible from one month to another. I mean, the amount can vary as the needs that I have to fulfill each month increase or not. But of course I wish I could put it aside every month as long as I have my salary paid out at the beginning of the month even if it's only a few percent of the amount I've managed to save. Part of it I think is good for investment, and part of it as an emergency fund.

My cash flow has been good because I have a salary based job. I'm thankful that bitcointalk gives me an additional source of income even though it won't be mine forever. As long as I can manage it properly and don't interfere with each other between expenses, investments and emergency funds then I will do it. But in advance, sorry for the slow response.

Yes, we are responsible for all the risky or possibly profitable decisions we make. It's just that we always hope that it will only lead us to always be on the good side financially without forgetting the risks in the practice.

There is a big gap between Bitcoin holding and gambling. The fundamental thing that comes up first is that Bitcoin has volatility so it can go from high to low. But in gambling there is no such chance. Gamblers bet money either get it back or lose it. If lost there is no second chance. One of the great successes of Bitcoin is that some people win even when they lose temporarily. What does that mean? From what I can see, those who bought Bitcoin at the highest price around $70K can also boast of being Bitcoin holders. Because it will go to that stage again. While I can't guarantee the timing here, I can assure that it will reach that level or exceed that price. Those who held bitcoins at whatever price they were purchased did not lose. But those who fail to put it in their basket are losers. There may also be times when a Satoshi becomes most desirable assets ‍and most expensive. So everyone should make good use of their time. Many people aim to get rich quick from bitcoin but the important lesson is “If You Can't Hold, You Won't Be Rich” which is my favorite quote from CZ  about holding.

Bitcoin holdings are different from gambling and should not be regarded as such. Trading Bitcoin, on the other hand, can almost be classified as gambling with a lesser risk unless it is futures trading, in which your assets can be liquidated. That's that.

There is also a higher chance of losing when one enters the market at the wrong time and purchases some Bitcoin when the price is very high. Let's take those that use the market trend and the highest bull run of them all, which was $68k or so. They purchased at this price and intend to hold for a higher price to be achieved so that they can take home a profit. If they are still holding, how will an economist calculate the value of the assetime and purchases some Bitcoin when the price is very high.

Let's take those that use the market trend and the highest bull run of them all, which was $68k or so. They purchased at this price and intend to hold for a higher price to be achieved so that they can take home a profit. If they are still holding, how will an economist calculate the value of the asset? (on the losing side), which has a very high chance of losing, which falls against your explanation.

But if we are to look at it from the Strange Dr.'s point of view as stipulated above, which I also agree with, a holder should only calculate losses when they have sold out their holdings out of panic and below their purchase price, but if they are holding strong for a very long time (no holding time limit), there is a very high possibility of taking home a profit when the price will eventually kick back up, but that can sometimes seem like a lifetime.


Profit is not always guaranteed for every long-time holder, but profit is certain for every long-time holder who is also a strong decision-maker when it comes to their price target.

I doubt there is exactly any kind of a strict formula (like 30% for example... because if you are going to support yourself for 6 months on your emergency fund, then you likely would need more than 30%.. even though maybe you could calculate that you might be able to survive on 30% of your actual income if you were put into an emergency situation that involved losing your cashflow for 6 months.. or various kinds of scenarios that can be contemplated an are somewhat individualistic in the ways that the probabiliites of the emergencies and how they might happen might play out). 

Many of us likely can get some kind of a framework in regards to how consistent is our cashflow (and how much of a cushion that we might have / or not), and how complicated our expenses are (if they are consistent, or if there are a bunch of built-in "unknowns," for example).

For example, if we are a single guy with a steady job and we are living on 50% of our salary (and we have 50% that can be spent however we like), then it would likely be way more straight-forward for a guy in that kind of a situation as compared to someone who might engage in work that has very inconsistent cashflows that might even be partly dependent on the efforts of others (such as running and/or owning a business), and also if a person has a family that s/he supports with his/her income, then there could be some inconsistencies regarding those expenses, depending on if some or all of the other members are contributing to the family finances or if they might be causing some unexpected increases in expenses. 

More complicated situations likely justify retaining a higher amount of liquid value in reserves.  By the way, liquid means that you are able to spend it or get access to it right away without any obstacles.. something like cash is very liquid, and residential property is not very liquid, stocks might have some liquidity, but might take several days or even weeks to liquidate.. Of course, bitcoin is pretty damned liquid, but if you are investing in bitcoin, you would not necessarily want bitcoin to count as part of your "emergency" funds until your holdings are in sufficient profits, and maybe you don't even want to be forced to sell it while you consider yourself to be in early BTC accumulation stages..

Like I said having some variation of 6 months cash reserves can be really great and empowering for any investor to achieve and to thereby allow a lot of investing freedom when the cashflow and the reserves are sufficiently/adequately in place to provide for that kind of flexibility, and how those reserves are held can vary too.. so they might need to have some amount of liquidity in terms of being able to be drawn from over 6 months, so they might not need to be 100% liquid upon demand in order to be able to be drawn from over a period of 6 months if such an emergency situation were to end up playing out that drug out for 6 months or maybe longer, but at the same time, if there is 6 months of reserves, and the reserves start to be depleted, many folks are not going to just sit back and let the reserves deplete because the situation would start to become even more and more stressful in the event that the reserves continue to be depleted and they get down to some kind of level of exhaustion or near exhaustion.

Holding bitcoin for the long term is not gambling because in gambling your chances of losing money is very high whereas by holding bitcoin you are not gambling, it's more sort of an investment that has a very little chance of ending up in a loss.

On the other hand, if you hold bitcoin for long term, it is almost certain that you will be rewarded good profit as bitcoin always increases over the long term period.

Also, it is not possible always to buy the perfect dip, but if you can DCA on every bitcoin dump, you can still end up averaging out at a good price.

There is this fact that "every Bitcoin trader is also a holder, but not all Bitcoin holders are traders." I think there are more Bitcoin holders than traders, the reason being that trading is not always profitable at all times, but in holding your Bitcoin, you don't have to lose anything unless the person is careless with their wallet security. There is this saying that "if you have not sold so cheap, then you have not lost anything." So if someone keeps holding until the bull market comes, they will definitely make a profit, no matter what small fraction of Bitcoin they have. They will make a profit that is equivalent to what they have invested.



To the professional trader (if there's any professionalism in training), I think they don't see trading Bitcoin as gambling. Just as we see holding as a potential way of making profit during a bull market, that's also how they see trading as a potential way of taking advantage of the market volatility to make more profit, so it's not really gambling to them, but those who are not also experienced in trading can mistake it for gambling.



Maybe they are seeing it that way because that's all they think they can invest in Bitcoin at that moment. You are seeing it as a blessing because you have the capital to accumulate more, but they don't, and they are only concerned for the price to be so bullish so they can take a little profit out of their holdings. Normally, the Bitcoin bear market is an opportunity for some Bitcoiners because they accumulate more, but for some others, they see it as not really a happy moment because their investment is dropping and they don't even have the capital to buy more.

Well said my friend, I think its probably better to hold than to risk your little coins on trading that is something more like gambling and everyone is well aware of the risks than its involved in gamble so being a patient buyer would probably be the trick to actually achieved some benefit in your long term investment. And like you said, I am still confused on how folks who hold small btc would complain when the price start dipping, it should actually be like some kind of blessing because that's exactly the way I see it, because the lower the market price the better chances you have to accumulate as much btc as you can for your investment because the number of bitcoin will get for 50$ when the price is 20k $  is not same when the price pumps to 30k$.

I also have doubts about the consistency of someone routinely setting aside 30% of their salary for an emergency fund. You might be able to if you have a good job that pays you every month, but really 30% is a very high percentage to save during inflation. All basic necessities are expensive and it will probably be really hard to maintain that consistency because the funds you need for unforeseen needs may vary from one month to another.

You may need to pay car taxes, replace some household appliances or maybe something else. This can ruin your fund-saving plan so that an emergency fund doesn't have to be forced into each month. An emergency fund is necessary, but you don't have to force it on a percentage or amount.

Unexpected expenditure or surprise is indeed very disturbing in the process of implementing the discipline of financial flow, which makes financial principles unstable, because usually emergency expenditure or surprise expenditure must be made priority, we must immediately complete it first. Emergency funds prepared must be sufficient in handling this but sometimes indeed beyond predictions, funds 30% of our salaries collected within a few months, with a surprise expenditure we need funds even more than what we have collected, in that position Indeed, temporarily making the decision to pause/reduce investment in Bitcoin is the right decision and we can continue the DCA back after everything is normal.
Maybe in the stage of refilling the emergency fund, after being drained more due to surprise spending, I think it depends on how the calculation takes into account the condition of his situation, whether he needs to recharge or continue as usual by saving 30% of his total income, and I think there's nothing wrong with that too Replenish your emergency fund before continuing with your investment.

I am not sure if there is a need to set aside any kind of specific amount (on a regular basis) in order to maintain your emergency fund, yet there are a variety of ways to assess whether your emergency fund is enough, including some kinds of considerations that if your cashflow were to dry up for six months could you still survive?  or if your expenses (also) were to go up for 6 months, or maybe both negative events happen at the same time, and in that regard, from where are you going to draw in order to be able to survive during that period in order to hopefully also attempt to be able to secure additional cashflow or to reduce your expenses back to levels in which your income is greater than your expenses... .so yeah, it may well not be prudent to be investing much if any into bitcoin while you are building your emergency fund, even though surely sometimes we can still start to invest and know that we are building up towards reaching a certain target (in terms of either building our emergency fund or maybe even replenishing our emergency fund if we had to draw from it at an earlier date)...

Some schools of thought would suggest not to invest at all into bitcoin or into anything else until you get your finances in order - even though I understand that sometimes there are not necessarily going to be strict rules, but ways that any of us might exercise caution and/or moderate investment approaches while we are getting our various finances into a better status (in the event that we might have some issues (problems) in regards to either the level of our cashflow or the level of our expenses or both).

Ultimately we are in charge of exercising our own judgements, including needing to take responsibility if we screw things up, and whether or not others are hurt from our mismanagement of our finances is part of the process of taking responsibility, hopefully learning along the way and hopefully improving our practices along the way.


I doubt that there are any strict formulas regarding how much to be in your budget for any specific category, and sure we can create formulas and targets for ourselves that might help us to attempt to create and/or to reach certain goals that we have created, and surely some folks have more discretionary income (which means money that is free to do whatever that you want with it because it is in excess of the money that you would need for expenses and/or in excess of any money that you might need to build or create an emergency fund) than others, and if you have a lot of discretionary income, then you are free to use more money to buy bitcoin with it.

And, yeah, to some extent, you might be able to create your own discretionary income or your own discretionary levels by figuring out how well your finances are in order at the time that you get into bitcoin or otherwise make your assessments about target levels of investment that you might want to achieve and how much that you are able to dedicate to such bitcoin investment process based on how much income that you have coming in versus how many expenses that you have, and sure you might have some months in which your income and your expenses are consistently the same, but you might have other months in which you might have either great cash surpluses or great shortages of cash for a variety of reasons that might have to do with irregular expenses or maybe even some "surprise" expenses... when you have surprise expenses within a particular month, for example, you might be faced with some dilemmas regarding whether you should still invest into bitcoin during that month or to cut back with your bitcoin investment or to completely withhold your investment into bitcoin until you are able to get your cashflow/expenses ratio back in order and perhaps aiming to replenish your cash reserves prior to resuming investing into bitcoin, too.

Don't be too fanatical about bitcoin so you don't need fiat, in fact, that is the wrong way, however, fiat is an important thing in life for everything we need, while bitcoin is only for the long term that can be obtained.

Reserve money is very important so that when there is an urgency that is needed it can be used in the right way and I always allocate where the emergency fund must be required while investing in bitcoin only a few percent must be set aside as long as we can routinely do that too much better for their investment in BTC.

You are right, maybe that has happened a lot when they already have assets in bitcoin while fiat money has never been reserved for other emergency needs, the safe way is the method above by balancing what our needs are.

20% bitcoin investment
30% emergency fund
50% as our daily needs/months

I think that's more than enough.

JayJuanGee, what you say is certainly highly recommended for any investor. I believe each of them need not put their budget 100% on bitcoin without diversifying their budget elsewhere. Even having some fiat reserves is recommended so that when they need money they don't have to ruin their long term investment plans. In the case of buy on dip and hold, selling bitcoins at a time of urgency should be avoided, so to be sure, adjusting or diversifying the budget is required. The emergency fund is mandatory instead of continuously growing the investment portfolio.

My guess is anyone who has an investment in bitcoin without having an emergency fund in fiat, then sooner or later they will sell their bitcoin. At least 20% - 40% of the total investment budget must be saved as an emergency fund, this will definitely help them if an emergency occurs.

Practice can bring a lot of improvements, and sometimes it could take a few years to really start to get used to how aggressive a person might be able to be without becoming overly aggressive in terms of how much to invest in bitcoin, how much to use for expenses and how much to keep in some other kinds of emergency funds that might not be linked to the price of bitcoin, but instead linked to the fiat currency in which expense might be accounted, and for sure, over 2-4 years many emergencies can happen, and it is not good that the person might have put themselves into their own emergency because they were trying to be more aggressive than they should have had been, just like your example of a person with a $500 monthly budget spending $400 on bitcoin when maybe that person should start out with smaller amounts, such as $100 and maybe build up to $400 later, if $400 is even reasonable at all.

There are likely ways to also consider an investment budget in terms of a percent of the cashflow.. maybe start out with 10% and then work towards higher levels, but at the same time,  many of us should be able to count up all of our expenses, but sometimes we also have difficulties being able to identify the variances in our cashflow and our expenses, and if we are able to plot out our budget on Excel spreadsheets or some kind of a easy way to keep track then we can try to both attempt to identify past issues but also attempt to project out future cashflows in such a way that we always have a bit of a budget cushion, too.. so it becomes less likely that we will have various cash crunches, and we might even be able to better see potential cash crunches that might come at future dates that might be based on various payment plans that we might get into and also even various ways that we might generate cash in the future that may or may not contribute towards greater abilities to have a cash cushion and also to potentially be able to invest in bitcoin now or in the future based on our cashflow projections - and hopefully we do not overly anticipate and we error on the side of NOT having as much cashflow and having more expenses.. and ONLY committing to buying bitcoin with our extra cashflow when we know that our cushion is fairly and reasonably projected into the future.

By the way, recently, I had gone out and projected out my cashflow until the end of 2024.. and I made some changes in some of my projected expenses (and to increase and double some of the categories) assumptions.. and so then when I went out and made the increased expenses changes, I saw that there were a few different months down the road that I would have some cashflow shortages based on my updated/amended projections - and I am glad that I when through the process of making those changes, so I can anticipate those shortage periods in advance and be in a better place to prepare for them, including having ideas from where I will draw the extra money in the event that my projections end up playing out and I don't have enough cash on hand to cover the expenses during the various shortage periods that I currently have projected out towards the end of 2024 (and that is ONLY projecting out about 20 months.. with the nearest 3-4 months being more important - and more of a potential crises - if there were to be some cashflow shortage considerations - as compared to the further out months). 

Well, to invest in Bitcoin, you don't have to fight for it; you don't have to struggle for it. What happens to some people is that they lack the right investment ideas and management. Someone is not supposed to invest in Bitcoin in a way that could interfere with their mental health, like investing when you cannot have a peaceful sleep because you are either bothered about the Bitcoin price fluctuation or because your supposed period of investment is about to elapse (like if you just want to invest and hold for some months with the hope of making profit within that period).

Bitcoin investment is supposed to be done in such a way that you don't have to get so worked up about anything or even some arising emergencies. Let's take, for example, someone who is working and earning $500 per month. He or she can make a budget for their needs in a month and decide to invest just $100 into Bitcoin every month and use the rest to settle their needs, but some people would just invest like $400 into Bitcoin and assume they can use the $100 to cater for their needs in that month, and if they are unable to manage that $100 for that month, they may be forced to sell some Bitcoin, and they might be selling it when the price is lower than what they have bought.

Although it might not be all, but some people are forced to sell their holdings because of a lack of planning on how their investment should go. They don't budget very well to know how much they are supposed to spend, how much they should keep in fiat for emergencies, and how much they should invest that will not affect them in any way. When all that is handled, the person will not be forced to sell their coins in just some situations.

Of course there are degrees in which some of us might attempt to time the market or to attempt to buy more on the dip or to buy less because we expect a dip to come in the future (that may or may not happen), so in that regard, there can be variance in terms of how much we end up attempting to strategize buying dips, which might not exactly be trading, but it is a kind of behavior that would deviate from a more strict practice of DCA buying that would not be so much concerned about whether a dip is happening or not.

Surely a more strict kind of trading would be to be selling BTC because you have a belief that the price is going to sufficiently drop lower in order that you would be able to buy back more than what you previously had (prior to your selling), and there are various ways in which selling can occur in terms of how much of your BTC portfolio that you might sell, how much of a dip that you would expect to experience before buying back, so there could be some variations of selling on the way up that might not really fit into traditional ideas of trading because at the time that you sell you are not expecting to buy back at lower prices, and maybe you end up selling lower amount or maybe you do end up using some or all of that money to buy BTC back because the BTC price ended up dropping.. but at the time that you sold, you were not selling for the purpose of expecting to be able to buy back at lower prices.

I tend to believe that it is not good to sell BTC with intentions to buy BTC back lower unless you get to a level of profits that causes your behaviors to be profitable no matter what you do, and in those kinds of cases, you have already reached a certain (high) level of BTC accumulation that you have a lot of options - which might not really be the case for anyone in their earlier stages of BTC accumulation and maybe that they have not even saved up a whole year of salary (in BTC) so they are hardly even close to having any kind of meaningful size in their budget in order that they should be feeling that they have a lot of options... and surely, guys (and gals) will vary in their determinations regarding how much BTC they feel that they need to accumulate in order to feel that they have a lot more BTC portfolio management options that might include both buying and selling with goals of BTC accumulation or whatever it might be that they feel their goals to be in terms of if they feel that they are mostly in BTC accumulation stages, or maintenance or liquidation.. and whether those different stages might trigger at 1x annual salary, 10x annual salary 25x annual salary or at some other point (possibly a higher threshold).... It seems to me that if guys (and gals) have not even accumulated 1x or 2x their annual salary, then they are likely not in a good position to be selling any of their BTC until they reach much higher levels of BTC accumulation.. and sure my opinion is likely to vary from the opinion of others on this matter in terms of where the threshold of sufficiently high enough BTC accumulation is enough...

I already mentioned in a previous post that in traditional asset evaluation circles, you likely need somewhere in the ballpark of 20x to 30x your annual salary to get to entry-level fuck you status.. and so getting into entry-level fuck you status might well be a reasonable goal for some people.. that could affect how they view their BTC accumulation or maintenance (management) in order to strive towards giving financial freedom (or at least financial options, if that might be part of what is sought).

Long term holding far more better and less risky, compared to trading, which is why i spend more time on reading Bitcoin speculative comments rathers to look for a trading package, because, by accumulating Bitcoin consistently I will arrive.at my financial goals easily and securely but unlike trading which is a gamble, one can lose everything at some point so i will rather hold for the long term rather than to risk everything trying to catch in on short-term trading gains.

I think buying more Bitcoin during a dip period shouldn't be considered as trading, even though that is what it is in practice, but also since accumulation is done occasionally, it cant be referred to as passive trading since a buyer may not even take note or try to take advantage of any leverage, all a holder does is to make a new purchase at internal unlike like passive traders, who are engaged with the market constantly and this activity reflect the activeness in day to day trading.

I somewhat understand what you are saying about some of the additional considerations in regards to being small, yet I would somewhat fight about this idea - and even Wind_FURY has brought it up many times..... and I tended to ongoingly assert that management of your BTC holdings (or even your cashflow) is not so much about how BIG or small you are, but instead in regards to reaching certain levels of profitability.

Of course, there can be confusion and overlap of the ideas because if you are early in your wealth accumulation, it may well NOT really seem like very much money that you are working with, and if you are adding $10 per week, it could take a long time to reach any kind of meaningful levels of accumulation... .. so sometimes we might consider what is the annual amount that we need to live, and if we were saving/investing 10% of our annual income, it may well take us 10 years to reach 1 year's annual income (that is if the investment asset merely just keeps up with inflation)... so yeah, if we had been investing for a while, then we might start to have several years worth of income in our investment portfolio.. and so then we are likely at more liberty to manage our holdings in different ways, and surely I have not been an advocate of selling any BTC prior to reaching a certain level of investment comfort (which likely is going to vary from individual to individual) and so for me, we are on a similar page in terms of talking about building to get up to a certain level, and selling is not part of the strategy to build.. .



I suppose that I mostly agree with this because once any of us gets to a state that we are able to sell on the way up (rather than just merely buying regularly and buying on the way down), we probably should be selling on the way up just to be able to offset some of our already having had achieved overexposure to the asset (in this case bitcoin), so maybe we start out by investing around 10% of our annual salary into bitcoin, and then maybe we do not have any other investments, so after a few years, we might start to get close to having all our investments ONLY in bitcoin, so in those kinds of cases, there may be some considerations regarding how to diversify some of the value out.. even though it is not necessarily a good idea to diversify out of winners and then end up investing in losers.

In terms of diversification, I am not referring to shitcoins, but instead diversifying out of bitcoin and into other asset classes.. maybe property and index funds.. and so these are difficult choices when trying to build wealth... and it is not so much about trading even though there may well be strategies that contribute to differing ways of portfolio management and investing into other items that might be affected more by if the price of BTC is either up or down.. and another difficulty is trying to be able to identify which asset might be more up or down than others, especially right now when the market value of so many asset classes is perverted by cheap money and outrageously and increasing levels of overall debt in society that systematically ends up affecting everyone and all of the various possible investments that can be made.


That does seem like a healthy way to think about your bitcoin while you are building the size of your holdings, and surely it is possible that it could take less than 10 years to reach 1 year worth of salary, even though historically, there have been some folks who ended up accelerating their wealth appreciation through their ongoing increasing of their BTC stash that ended up paying off when BTC prices went up.. and yeah, we know that there are no guarantees.. but still at minimum, many of us are still going to hope that after 5 or 10 years or more investing into bitcoin that we would be able to look back and see that bitcoin was at least as good of an investment as anything else that we might have had been able to invest into, and it would be icing on the cake if bitcoin were to have had outperformed other asset classes, even though surely there are no guarantees that it is going to have had outperformed all asset classes, and we merely are making an asymmetric bet in that potential for profit direction that may or may not end up playing out.

As a small bitcoin holder i dare not to trade with BTC if I wish. Because volatility might eat up my little BTC. But for small holders I think holding Bitcoin is more suitable than trading. A trader is not always profitable. But I want to keep myself out of this calculation of profit or loss and try to keep up with DCA. There are many small BTC holders like me who were afraid to dream. Today they dare to dream that is only by holding BTC. A big trader might be able to temporarily invest in Bitcoin and walk away with money but there are many holders like us who choose Bitcoin as their permanent asset. More than gold or any other precious commodity, BTC has come to be considered a permanent asset to our holders. When the price of Bitcoin falls, some people express disappointment, but some holders like us smile because there will be an opportunity to buy Bitcoin at a lower price.

yes, and we as human beings and given reason and mind by God,
so we have to be able to think well and we have to learn to strategize and we have to fight as hard as we can.
and invest in btc in my opinion need an investment trading strategy and so on.

and usually many people are forced to sell btc because of emergencies such as illness,
which of course requires a large fee.

and in my opinion it would be better if a btc investor has a health card or health insurance. With the aim not to interfere with investing in btc.

as simple as possible, can you interpret this to provide broader insight. I'm not going to do something that I've missed in previous years I mean not gradually accumulating bitcoin in my portfolio. So going back to the basics and building awareness of things that have happened before to do it in each period with the DCA strategy and have a bit of an aggressive spirit that I can increase when I get higher earnings.

In adjusting the level of purchases, investors generally do it gradually, and they also do it repeatedly until they get a certain momentum in each of their purchases to multiply aggressively when they have the confidence to do so.