Topic: DCA method - page 5. (Read 3547 times)

You will not enjoy the real importance of DCA and hodli for a long term if you are only after buying at the bear and sell at the bull run as a trader. You will only get little profits instead of a good amount of profit from your bitcoin investment due to the compounding value of your investment if you increase and hodli your bitcoin overtime.

However, if you are cool with what you are doing, that's fine but I am investing and saving for the future and that is why buying and selling within short-term is not for me.

Surely you are talking about using DCA in a trading kind of an approach and you admit that you are not a long term investor in BTC.

One of the advantages of DCA is to allow normal people to invest in the long term even in traditional investments, it could take long term investors 30-40 years or even longer to get to some kind of a potential retirement status, and surely even most people never really reach a kind of financial independent or fuck you status where they can stop working early... so surely a long term investment might allow someone to try to reach those kinds of possible fuck you status goals and perhaps with bitcoin they might be able to reach fuck you status in half of the time... 15-20 years, and yeah of course reaching fuck you status is not guaranteed, yet DCA can still frequently be employed for relatively normal people to establish an investment and even to do it at a level that works for them, whether it is $100 per week or some other amount that they might be able to set aside without necessarily considering whether BTC prices are in a dip or a top, and they might not even need to know very much about bitcoin at all beyond having some conviction that it is a good place to put money as compared with other places that they might choose to invest.

There will be variation in the level of knowledge that a person employing DCA might want to build and there also can be a lot of variation in the level of income that such person might have, yet it surely seems that DCA tends to be more of a tool to bring potential benefits to long term investors and it is not as good for short-term investors and/or trading, even though surely traders (and even shitcoiners) do seem to frequently talk about using DCA in order to establish their positions, even when they are also trying to figure out their exit point too (which is truly a trading mindset and a trading practice).... even though this thread is about bitcoin and also bitcoin does really seem to be more something that normies should be considering investing into rather than trading, even though you are free to do whatever you like, even dumb things like trading bitcoin rather than investing into it in long term (including 4-10 years or more time periods)..

No one really knows what? When to buy? I think you are wrong, we all know what Bull market and bear market looks like, what you should be warning others about trying to time the bottom or the top, but the bottom and the top doesn't happen in a day, it takes time for corrections to happen.

Use Bear market for buying and use Bull market for profit taking, it is that simple, DCA is best for the long term but when Bitcoin is massively over valued I won't keep buying just because my plan is long term, that's plain stupidity.

The market will bottom in a bull market, bad news always happen after Bitcoin tops out, once that happens start buying, the best time for DCA is in a bear market, I  won't be buying the tops just because I won't to hold for long term, never.

Maybe an example would be helpful, since even using a lump sum (investing right away) method does not need to be all or nothing and surely individuals have discretion in how they are going to deploy the money they have available and even the money that they decide that they are going to allocate towards bitcoin investing.

Let's say that a person had already established a practice of investing $100 per week, and he had been investing in bitcoin since the beginning of 2024.. so his history of investing is not very long, and he is also in the process of making sure that his cashflow management practices are in a good position, so all of a sudden, for some reason he receives an extra $5,100, and with that $5,100 he has quite a bit of flexibility how to assign it, and he already knows that he is doing $100 per week in DCA, so  maybe he could decide to divide it into three parts which would be $1,700 each.. to use 1/3 for buying right away, another 1/3 for adding to his DCA and the other 1/3 for buying on the dip.  Of course, his regular DCA is a practice that is buying right away with money that comes available, yet if he decides to assign DCA with his lump sum amount then he is engaging in a time-based deferral, and with the 1/3 assigned to buying on dip he would be engaging in a price-based deferral that might not end up happening. 

So if he thinks about his $5,200 like that, then he might decide to change the proportions to allocate more of it to just buying right away..so maybe he buys right away with $4k and then divides the remaining $1,200 into buying on dips (since he is already engaged in DCA of $100 on a weekly basis, he does not see any need to defer and add to his already existing weekly DCA), and so there can be a lot of ways to divide up his ways of considering the extra money that he came across and that he had already allocated to BTC investing. and he just needs to figure out a balance that is comfortable for him, and surely some folks might just choose to use it all to buy right away, but maybe structure the buys over several days or maybe even over a couple of weeks.

Each way of buying has trade offs, and so if he already accounts for the trade-offs he is in a better position, and many of us likely enjoy having the luxury of receiving some extra amount of money, and prior to investing into bitcoin (or having a system in place for investing into bitcoin), our first thoughts might have had been to go on a vacation or buy some consumer items that we may or may not need, so if we already have a bitcoin investing system in place, we have the option to plug some or all of our extra cash into bitcoin.

But all really matter depend on your cashflow or financial situation, but if they are capable to use this strategy then its fine since this is also proven working for people who also want to earn for long term investment.

If they cannot afford to do that our doubting then they still have another option to use DCA which is perfect for everyone. Everything is all depends to the person on what suitable to them, but they could try to use both so that they can gather experience since for sure every information or knowledge they get for trying it will be worth it since they gain something useful that can help on their bitcoin investment.

I agree with you and I also want to add that the lump sum strategy plays a vital role of putting an investors money to start working for him right away as soon as possible by putting your investment upfront for a long term investment plan. But however, irrespective of our strategy or strategies maximizing and ensuring our Bitcoin size is of good size up to a reasonable amount or quantity and the ability to hold for as long as long as possibly 4 to 10 years or more is of paramount concern, and let our strategy or strategies suit us in which ever way, very important.

The thing is that lump sum could obtain the same outcome, as in, you just put all the money into it right now and forget about it, without checking the prices all the time.

This also has the benefit of not having to worry about fees or making sure the transactions are done correctly, etc.

Having said that, most people won't have a big chunk of money that can be used to buy a large amount in a single transaction, so DCA is usually the most common strategy.

But from a point of view where you want to maximize the amount of Bitcoin, then lump sum could be better than DCA, depending on the future price of Bitcoin.

For me, this DCA strategy is an anti-loss step in investing not only for beginners but also for those who have known BTC for a long time. Especially if we do DCA in a weekly period, of course this is much better because the increase will be faster. Because the goal of DCA is to get as much btc as possible in a long period, without having to worry about price changes every week.

That's why we must have a stable cash flow so that this strategy can run well. That's why many people in this forum always give advice to other members, especially beginners, if you really intend to invest in btc, you have to be smart in finding additional income. Because the dca method is the coolest strategy for long-term investment, and the capital is only patience so that the goals we want are achieved. That's also why the dca method is very suitable for btc because btc has certainty and good fundamentals in the future compared to other coins without any worries.

This happens actually quite simply from the reason they do when they buy every week rather than every month for beginners it is based on the thought that they only want to try to buy when they are still very capable of doing it especially this is a form of condition where their enthusiasm for buying is still very large so that they don't really care about other things besides buying while they have money that they will not use in a certain period of time so that this buying spirit is still quite good even though in the end over time this kind of intensity must be rethought especially when it is indeed a burden other than buying while they have money that they will not use in a certain period of time so that the spirit of buying is still quite good even though in the end over time this kind of intensity must certainly be rethought especially when the burden we take in buying is too large from the budget we have planned before.

But it is undeniable when a beginner who is in the focus of buying everything must feel the same way and I also feel that I have done something like that where my thinking is still very simple when i want to keep buying when i can do it without bothering to think about other things because the most important thing is buying and getting bitcoin is the main focus .

Those who are new to chips will certainly be very useful for them using the DCA method because anyone can do the method easily and most importantly they do it consistently then there will be profits after maintaining the assets they own in the long term, I agree with you because the volatility of Bitcoin is very high so no one can know exactly when the price of Bitcoin will increase and by using the in the process of accumulating, this will certainly provide profits according to the assets that we have collected.

Largely the reason that I suggest weekly buys is to attempt to have newbies interacting with their bitcoin portfolio on a regular basis, and so perhaps to be attempting to learn every week too, so there would be a kind of making bitcoin as a priority, yet surely some folks might ONLY be able to invest $10 per week rather than $100 per week, and so they can ONLY invest in accordance with their budget and the amount of their discretionary income, and yeah, there are going to be some folks who are not only poor but also they might have uncertainties in regards to finalizing their cashflows and expenses each month. 

In my opinion, if a person already has uncertainties in his cashflow, then he is going to be in a better position to keep some extra cushion and cash on hand to deal with some of the uncertainties, and so maybe he keeps an extra few hundred dollars to deal with uncertainties, but also $40-$50 so that he can at minimum make his $10 per week BTC purchases.. And, yeah devil is in the details, and some people have so much uncertainty that they never have any extra cash, yet it seems that part of the responsibilities of investing is to create various kinds of securities and cash cushions in order to be able to be investing rather than gambling, and the cash cushions give those kinds of protections to make it less likely to have to tap into the bitcoin investment at a time that is not of their choosing.. and to even not spend too much time thinking about the price fluctuations taking place in bitcoin for 4-10 years or longer, and surely some folks may well have investment timelines that should be in the 15-20 years or longer timeline yet of course, from time to time, revaluations can be made in terms of whether any changes in the ways of investing into bitcoin need to be made or if the person might have gone from a BTC accumulation stage into a maintenance stage.

Cash cushions also relate to various kinds of back up funds that can be labeled as emergency fund, reserves and cash floats, and someone who has very uncertain finances might take more than a year to merely build up his emergency fund and his investment into bitcoin to amount to 3 months of his expenses in each of those, and surely it could be possible to both invest into bitcoin and to build up the emergency fund to at least a minimum of 3 months at the same time, yet surely whenever the emergency fund is less than 3 months, then there would be a risk that the BTC might end up serving as part of the emergency fund in the event an actual emergency happened in which cashflow  disappeared and/or expenses were to go up.

If a person cannot figure out the extent to which his income exceeds his expenses or even that he has erratic cashflow, yet he can see that he has expenses that are coming up in 3-6 months, so that he is not able to commit to investing into bitcoin for 4-10 years or longer, then that means that his discretionary income is not high enough to invest in bitcoin, and if he chooses to invest into bitcoin he would be trading or gambling with his expense money rather than investing, especially since we cannot know which direction the bitcoin price will go in the period of time that he already knows that he is going to need the money... and another thing is that we don't even know that bitcoin prices will be profitable 4-10 years or longer down the road, yet we invest with a certain level of willing to commit that we could end up losing the whole of the investment, yet if we do not engage in leveraging of the investment, then the most that we could lose is 100% of what we put in, so even though we are investing with anticipation that our odds for up are greater than our odds for down, and we even consider bitcoin to be amongst the best of places to put money (if not the best), we still are not guaranteed to be in profits at the end of our investment timeline, even if we have a relatively long timeline.


We are not guaranteed that BTC prices will increase, and surely if BTC prices increase, then we would have had been better off to front-load and to buy all in the beginning rather than DCAing, yet one of the difficulties in front loading and/or lump sum investing is that people do not tend to have an ability to front load or to lump sum invest, and so they might not even invest at all into bitcoin or anything else if they were not to be taking a reasonable amount from their weekly discretionary income...  Frequently DCA allows someone to invest continuously, persistently and ongoingly with some reasonable amount of money that ends up adding up to way more money than he would have had been able to save up on the side.. so there is a certain power in stacking away that value and putting it into bitcoin, which has decently good chances of not ONLY retaining the value but appreciating in value better than other investments (again, it is not guaranteed to appreciate, even though bitcoin's investment thesis remains strong and each of us are taking chances that bitcoin's investment thesis could end up collapsing during the period of our investment into it).


I think you are correct, yet you are still framing the issue in terms of guarantee, which bitcoin is not guaranteed, and I think that a better way of framing the matter is that DCA ONLY works when the investment asset (in this case bitcoin) has strong enough fundamentals that its odds of going up are greater than its odds of going down, and so part of the reason that we can potentially invest blindly into bitcoin for 4-10 years or longer in a DCA kind of manner is that it could well be one of the assets that we have a certain level of confidence that if we fell into a coma and were not revived for 10 years, then we would still be glad that we are in bitcoin rather than having our money in some other asset, even the dollar or wherever else we might put value, there could be some need to have a certain level of confidence to be able to just sit on the investment for a decently long period of time, such as 10 years or longer and have a certain level of confidence in it retaining its value and perhaps even appreciating in value... and yeah, sure there are going to be folks who need to have investment timelines that are shorter than 10 years too.. yet every time new value is invested into bitcoin, the timeline for that new value that is being injected should be 4-10 years or longer, even if a person might have already been investing into bitcoin for 4-10 years, if he injects new value then the new value should have a 4-10 year or longer timeline in order to be considered as investing rather than trading with that portion. 

At some point during a person's investment, they might decide that they have accumulated enough BTC, so they might either change their way of BTC accumulation or stop accumulation of BTC, yet merely stopping accumulating need not mean that they go into selling mode, so they could just maintain their stack until they reach of time that they might decide to start to withdraw from it based on price based withdrawals or perhaps based on time based withdrawals, and they might ONLY be selling very small portions of their BTC stash once they enter into such withdrawal period.. perhaps also assuming that they are supplementing other sources of their income that they would spend prior to spending their BTC.


DCA works for bitcoin, but not necessarily for shitcoins (which you seem to be mixed up if you are talking about cryptocurrencies, since if you are talkiing about bitcoin, then talk about bitcoin.  The term crypto currency is ambiguous and perhaps even misleading in regards to what you are talking about - unless you were just trying to sound smart, but the thing is that when you use vague and misleading terms then you look dumb rather than smart, in the event that you weren't being purposefully misleading in your choice to employ such term rather than just saying bitcoin if you had been meaning to talk about bitcoin rather than referring to some vague and amorphous idea that might mean that you don't know the difference between bitcoin and shitcoins and you wrongly believe that DCA works with shitcoins when it doesn't since DCA is a investing strategy not a trading strategy, and shitcoins would fall into the trading rather than investing camp since there is no way to really rely on any of them to have any long term potential.

DCA method is one of the best method to invest. DCA method is better for those who are not into Cryptocurrency but have heard talk about Cryptocurrency and developed love for Cryptocurrency and want to invest in Cryptocurrency but don't have enough bitcoins and have very low weekly or monthly earnings but want to invest. If they can buy and invest bitcoins with monthly or weekly income using DCA method then it will make a very good investment for them in future and get good success from here.

Moreover, due to the high volatility of the Bitcoin market, no one can tell which direction the market will go, so if a person invests using the DCA method, then there is no need to worry about the market.

The idea is indeed better to make purchases weekly so that BTC will increase much faster, but the problem is when the cash flow is unstable and they do not have weekly capital to make purchases.
Why this reason can be justified because buying using the DCA pattern against BTC will be much more profitable because this asset will continue to get an increase moment for each period even though it cannot be separated from the correction process.

DCA is not appropriate if the asset purchased does not provide certainty like BTC so that the basic capital will be suppressed with a much lower selling price.
This is the reason why DCA is more suitable for BTC investment in my opinion.

You sound mixed up, since DCA versus lump sum will always depend on if the person employing lump sum even has lump sum available at the time that he starts investing in bitcoin. 

If you are hypothesizing that a person has lump sum available when he starts investing into bitcoin, then he can choose whether to invest all of it right away or alternatively to also employ DCA (which is delay based time considerations) and/or he could choose to employ buying based on dip due to price dips that may or may not end up playing out.

Most people (or more likely an overwhelming majority of normal people) do not tend to have money that they can just invest into bitcoin as a lump sum, so it seems that DCA is more practical for a large number of people who can invest into bitcoin as the money comes available to them.

Seems pointless to try to compare lump sum and/or DCA unless getting past the presumption that someone actually has an ability to lump sum buy.


One thing is looking back at facts and considering when you started investing, and so the longer that you have been investing, then the more likely that you would be doing better.  Also, if you have a certain budget and money comes available at a certain time, then you have to take into account when the money comes available.. so dealing with facts.

If you are starting to invest right now, then you have your own budget to contend with.

Are you a proponent of any kind of certain system? or you just want to waffle around with a bunch of assertions that it depends?

Look at your own entry into bitcoin?  You registered in the forum in June 2021, so that is a bit over 3 years, so you could compare what you could have had done based on your budget versus what you chose to do, and there are likely not very many cases that could beat a DCA approach.  Of course, if you had a lump sum that was available at the beginning of your getting involved into bitcoin, then you could have started with the lump sum, yet when you got into bitcoin (or at least when you registered in the forum), we were in the midst of a bullish year, yet the summer of 2021 was a dipping portion of the year, and so even if you had a lump sum available at that time, you might have had considered whether it would be good to invest with a lump sum right away or the extent to which to employ DCA and/or buying on dips to supplement whatever you were considering choosing to do with your lump sum.  For sure people with lump sums have more options, yet like I mentioned, an overwhelming majority of folks do not have lump sums available when they come to bitcoin or any other investment, which is also one of the reasons that DCA is so effective and broadly applicable as an investment technique.


Most of the time DCA is best for newbies, yet surely adults can do whatever they like and be responsible for their choices.. and yeah, if they have lump sum available then they have more options, even though surely most people do not have lump sum available, so there is a need to figure out that part first in regards to how much is available.  Maybe you want to provide some kind of an example rather than waffling around with unclear and somewhat vague answers in terms of proclaiming that "it depends?"


Many times, we are not going to know if the BTC price is going to be going up or going down, so if someone does not have any bitcoin or has hardly any bitcoin, then the ONLY way to prepare for UP is to buy some bitcoin, and if he has lump sum available he can invest some or all of it right away or he can divide the lump sum into parts that allow for DCA and/or buying on dips.  If he has an income then he can DCA with the income, and surely if he does not have any BTC, then waiting to invest and/or waiting for dips ONLY prepares for down without preparing for UP, so I really doubt it is a good idea, especially with bitcoin, to ONLY prepare for down, especially if you are a low coiner or a no coiner.  Once you have some coins, then you have more options, yet it seems that an overwhelming majority of the world's population is either no coiners or low coiners, so it seems better to presume that most people should be buying BTC no matter what the price, otherwise they are not prepared for up, which surely does not seem to be a good place to be.  But, yeah, each person is responsible for his own decisions regarding whether to invest into bitcoin and then if so, how to invest in bitcoin, and decisions to not invest into bitcoin are decisions as well and he has to live with the consequences of that, which does not seem too insightful if someone knows himself to be a low coiner or a no coiner.

The thing is that comparing DCA with lump sum will always depend on the actual prices in the period of time involved.

Using historical data you can always move around your window until it fits either DCA or lump sum as the better strategy.

So, in some cases DCA will be the better strategy and in others it will be lump sum at the beginning.

In a simplified way, if the price goes up, lump sum is better, but if the price goes down DCA is better because you end up with more Bitcoin for your fiat in the end.

Fixed the above for you to make it a more accurate statement since DCA is ONLY a profitable strategy if the asset ends up going up in price and at least becomes worth more than your average costs for it.

The historical fact that bitcoin has been going up in price does not guarantee its price to continue to go up.

Sure bitcoin is amongst the best of investments available on a wide-spread basis, if not the best investment - yet it is still bitcoin NOT guaranteed to be long-term profitable whether employing DCA or employing some other strategy.

Don't get me wrong. DCA is also likely the best of strategies for newbies and even for almost anyone who might not have lump sum cash available, since DCA allows to set a level of ongoing BTC investing based on discretionary income available and to individually tailor such BTC investment amounts to the extent that discretionary income changes (amount of income left over after expenses).


There is nothing really wrong with the example (here's the link to that particular example), and guys can go to that dcabtc.com website and enter in their own numbers and/or timeline.  

The dcabtc.com website does not always calculate accurately for today's price (or value of the holdings), but I think that it is pretty accurate for the total amount of BTC that would have had been accumulated.   I would suggest when using that site sometimes it may be better to calculate the numbers based on how much BTC would have had been accumulated an then multiply that number by today's price.  So 0.1489 BTC multiplied by your price of $56,185 would be $8,366.  and so no problem.. still profitable.. .. also we could calculate average cost per BTC as right around $20,148 (which in your example would be $3,000 divided by 0.1489 BTC).  

Alternative DCA calculating sites might be:

 the dcacryptocalculator.com.. with similar results

or

https://costavg.com/ (you have to put in your own numbers to show the extent to which the results show up differently on this site with even showing a table of weekly or monthly amounts that would have had been invested)

So the results for each of the tables is showing what would have had happened if you would have invested according to the data inputted, and it does not show you what is going to happen into the future.

I personally prefer the idea of newbies to invest into BTC weekly rather than monthly, but yeah it is understandable that sometimes it might be difficult for newbies or anyone else to carry out weekly BTC buying based on cashflow uncertainties. .. issues with not knowing exact income versus expenses.

DCA strategy is always a long term profitable strategy. The DCA strategy is for middle-income people, that is, those who don't have a lot of money but are interested in investing in Bitcoin. If such a person had started investing in Bitcoin 5-10 years ago, he would still have made a lot of profit.

As an example I am showing a DCA chart for the last 5 years:

Here you can see that if a person had invested $50 on a monthly basis using DCA 5 years ago today, his total investment portfolio would have been $3000 today, and holding these 5 years his profit portfolio would have been worth $6926, which is his investment, 230% more than that, and his total savings would have been $9926. Also it's current price is $56,185, so imagine if you continue investing like this, and when Bitcoin crosses 100K, then how much be your profit? This will benefit you considerably. So always think of DCA, it is the best way to invest. This will benefit everyone in the long term holding.

Bitcoin will be something that is needed in achieving the stage of freedom but few people understand how to collect even though they do not have the capital to buy.
DCA would be a good idea for this kind of person to collect and there is no reason for them not to be able to buy.
Sometimes people don't know how to start so they don't want to think about getting involved and some people don't dare to take a little risk in it.

DCA is very appropriate for anyone to do and they can make a weekly or monthly percentage to make purchases according to the capital they have.
So with this method there is no reason for anyone not to be able to buy bitcoin if they have an interest in investing.

It's not actually bad to read those ups and down infact it's a good practice to have the Idea of reading those charts but  getting to predict the best price to buy or sell won't work which is why you might  end up losing alot trying to  trade the market. It's actually hard to predict Bitcoin market most times as you need both TA and FA  at the same time for your prediction(that's doesn't still give a guarantee of what market might hold).
Thus, the best way is just Holding, you don't need a best price entry when  you have the DCA strategy, all you have to do is buy  at different intervals and also if possible   buy DIPs along and with time you will start realising nice ROI.

Yeah, but the thing is that no one really knows that.

No one can predict accurately when the highest value or the lowest value will happen.

Also in the long term that doesn't matter too much as long as you are roughly correct in the direction, for example you can assume certain assets will appreciate over time.

That means that if you exchange cash for those assets you will probably end up wealthier over time.