Topic: HODL bitcoins, you can do it! Look at HODL camp map to build up strong hands - page 11. (Read 2963 times)

And that to me is the brilliance of DCA which I will always recommend, in fact, the only thing I advice. Whatever the situation, whatever the financial cashflow available and whatever the risk appetite, DCA always wins you some gains even as short as 2 to 3 years (the entire bear window in a cycle).

It even gives confidence and experience to those who can't afford strategy or don't have wisdom. It's like a surefire way, I wish I did it much earlier.

This proves but one thing, it shows that there's a lot of nuance involved in deciding how to choose one's investment approach. It's not as simple as choosing one approach over the other,  it's about balancing risk and reward, and finding the right mix for your personal situation. It's also very important to consider your long-term goals and how the different approaches might impact your ability to reach those goals.

The Lump Sum and DCA debate is often framed as an either/or proposition, but there are actually a lot of different options in between. It's possible to split the difference and do a combination of both strategies. For example, someone could make a large lump sum investment but then use DCA to gradually increase their position over time or they could alternatively do a smaller lump sum investment and then use DCA to add to their position if the price goes down. Because either ways one should really be prepared for everything when investing in Bitcoin, it's good to be optimistic about the price of Bitcoin going up, maybe due to your research or some circumstances that may propel it to go up, some people even make important financial decisions that would affect them just because someone else says so. Just being optimistic isn't enough, one have to also prepare for the worse too, prepare for an alternate measure, just incase things doesn't go as expected.

Some people might feel comfortable making decisions that concern their investment on their own and without involving any third party, but I Believe it's really important to consult a financial advisor who can help them weigh the different options and make a decision that's right for them. Because most investors don't even know what decision would impact their goals, some are following a strategy simply because others are doing the same thing. This is why it would be really helpful to seek the services of a financial advisor so one can start making the right decision towards choosing the right approach.

I think the DCA method is more systematic and takes a well defined approach and not done randomly whenever the investors have some funds. There were even more refinement made to ensure that both buying and holding are done efficiently. One of such is the need to set aside emergency funds for any urgent need that comes up within the buying period. This will ensure the investor does not sell off his Bitcoin when he run into problems. Recur that the ultimate purpose of making the investment is to be able to HODL just like this thread suggested.

It will be difficult to HODL if adequate plans are not made to prepare for emergencies. You cannot manage your BTC portfolio well if you inject all your cashflow into Bitcoin without setting aside some funds. People who do this are forced to sell their BTC when they do not plan to and even at low prices because they are in desperate need of funds.

There does not need to be any kind of either or mindset, and you (Gormicsta) even mentioned earlier that guys should be attempting to align their strategy to their various goals.

And, so yeah, let's take that person with $100k.  What else do we know about him?  Maybe we can imagine that the $100k  is some kind of proportion of his overall investment portfolio, and he might be inclined towards front loading his BTC investment or maybe he just wants to get his investment out of the way so that he does not have to think about it. 

Well, if he had already told himself taht he is ONLY going in for $100k and that's it, then he has a very narrow way of thinking

We might imagine that he might want to take that size of investment into bitcoin because he wants to put 25% of his total investment portfolio into bitcoin.. so maybe his investment portfolio is $300k and if he puts $100k of bitcoin then BTC becomes 25% of his investment portfolio.

Personally I like the idea of front loading but also considering various ways to supplement any investment.  Maybe a guy like this has $100k plus he has a cashflow in which he could invest $500 per week into bitcoin for the next 26 weeks (so that would be an additional $13k)  The three categories that he has to consider for the $100k is DCA, buying on dips and lump sum.  Based on his $13k coming in in the next 6 months, he could divide into three parts which might be $33,333 in each part, or he could take some other approach.. to maybe include his cashflow into the calculation which would be $37,666 for each of the three parts ($113k / 3).  But yeah if he is a bit anxious to get in, then maybe  he puts something like $70k into front-loading by lump sum buying and the other two parts of buying on dip and DCA might therefore be $21.5k each ($43k/2). 

There are a lot of creative ways to calculate how much cash you have available now and account for your cashflow and also account for being prepared in case the BTC price goes down instead of up.. but sometimes people are so determined that the price is ulitmately gong up that they do not mind just front loading all of it and not preparing for down or sideways and their cashflow does not matter as much as it does to people who might rely more on cashflows rathe than money that they can move around from other investments. 

At that point that person will no longer be an investor but a long term trader, and without a doubt someone which can identify with some degree of accuracy when each cycle is about to appear can make more money than someone that is just holding their coins, the catch is that this is too difficult and the majority of us cannot do it, for this reason we prefer simply to buy bitcoin whenever we have some cash around and hold it for as long as we can, and despite the simplicity of this strategy, it is a very effective one.

BlackRock's Rick Rieder Talks Bitcoin With WSJ's Take On the Week
https://www.wsj.com/livecoverage/stock-market-today-dow-jones-earnings-02-08-2024/card/blackrock-s-rick-rieder-talks-bitcoin-with-wsj-s-take-on-the-week-HqJNsb92geninqxoD1qb

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When I see articles like this, I stop believing in price pumps. There are also other opinions that national currencies are crap, and the only way out is to buy Bitcoin.
The only thing I don’t know is the level to which the price will pump, but then we will fly down.
If you listen to well-known experts, then look at what they said following the last fall in the price of Bitcoin.

It depends on the individual qualities of the investor, if he can identify bearish and bullish markets, then he can take profits every cycle without waiting for ten years and buy again in the bearish market. Hold is very good, the main goal should be to hold Bitcoin, but if the investor has enough knowledge to increase the amount of Bitcoin then this will be an even better investment. If there is a fear that he may lose what he has, or is not confident in his analytical abilities, then it is better not to sell, and to hold for as long, as he sees fit.

And if you hold for a long time then you have, it is holding of like ten to more years and that is what holding is supposed to look like, see a lot of people now when they hold for maybe one of two years they start complaining and the next thing you will sell this thing is strategic and you have to invest with a reasonable amount for you to be able to archive that kind of goal because having bitcoin worth of maybe worth 100 dollars and you holding for 10 years you won't have any significant profit, and that is a newly discovered thing for me if you want to buy, it is better to buy some significant amount of bitcoin.

people who hold will not even want to have any business with using it as a currency, their focus should be the profit they will make over the years, I wish I could even open my own mining farm someday that will be a wish come true.

I couldn't agree with you more there. True, a lot of people consider DCA to be a method for gradually investing small amounts of money, but it may also be applied to greater sums. Also, as you pointed out, even if you make a sizable first investment, you'll probably want to make more in the future, so it's really just another type of DCA. Actually, more than anything else, it's a mindset.

I think a common misperception about DCA is that it's only for those with little money. In actuality, though, DCA can be an effective strategy for everybody, regardless of their financial circumstances. As an illustration, suppose you have $100,000 to invest. You must choose between employing DCA and lump summing. You will immediately have $100,000 in the market if you invest it all at once, but you will also be taking on greater risk. You can lose a lot of money if the market dips soon after you make an investment.

However, you will be distributing your risk and investing your money gradually if you employ DCA and invest $10,000 every month for 10 months. Thus, even if the market dips, you will only lose a little portion of your investment. Additionally, DCAing will help you in the long run because you'll end up purchasing more Bitcoin during periods of low price and less during periods of high price. Therefore, if you employ DCA, you can ultimately wind up having more Bitcoin even if you're investing the same amount of money.

I'd argue that DCA is the most practical way to invest for any kind of sum of money -- even if you're doing lumpsum now/today, you'll want to invest more in the future (who doesn't?). I don't think there's any case of any guy who says I'll invest $1 million in this asset today, we're done.

They're going to see it in a few years and grow it even more. Another lumpsum? Sure, then it essentially becomes DCA over time

If there was a perfect and flawless investment approach then everyone would be trooping into it. Every investment technique or approach has its disadvantages, whether you wanna DCA or you wanna Lump Sum, they all have their risks attached, but it's left for you to choose which pattern is a lot more easier for you or the one that aligns with your investment goals. For instance, if your goal is to HODL Bitcoin for the long term or the short-term. This will help you choose or decide which technique to employ, so it's not really about perfection but which is in alignment with your investment goals. Like I stated before, let's assume you wish to HODL for long term, you'll be wish enough not to choose Lump Summing because you might get caught of with the whole market tension, same thing with when you just want to HODL for a short-term with intentions of making a quick profit out of Bitcoin, this way, Lump Summing is thr best technique for you because you'll need to target a particular time in thr market and then put in all your money and if things just go according to your plan and the market takes positive turn, you'll make your profits just about immediately. So it's about choosing the right technique that suites and aligns with your goals.

In as much the Automatic DCA has an advantage it must surely have disadvantages, it can never be too perfect, we are now left with the choice whether to follow such a pattern or not.
Making use of the automatic DCA strategy should be activated only when their is a close interval between the time of DCAING, like trying to DCA in every 3 to 4 days period then applying this will help reduce the work load of consistently purchasing without skipping any day.

You're correct that Automatic DCA can be a pain the a$$ sometimes because it doesn't let you choose the timing of when to make your investment but we can't also overlook the importance of automatic DCA.
The convenience associated with automatic DCA is one of its primary advantages. The system will take care of remembering to make your investments on a regular basis, so you don't have to. This might be especially useful if you're busy or have a tendency to forget to invest. We are aware of investors who, because to their hectic schedules or excessive activities, occasionally forget to DCA for the day.

The ability of automatic DCA to lessen the emotional impact of investing is another benefit. When the market is highly volatile, it can be difficult to maintain discipline and follow a strategy that you've initially set to follow, but automatic DCA can help you remain on course.


Well, It actually depends on your unique situation and choices, though. However, it can be worthwhile to think about manual DCA rather than automatic DCA if you're someone who is at ease handling your own assets and doesn't mind the additional work. In this manner, you will have greater control over your tax status and be able to select the precise timing and amount of your investment.

It seems that you have not described the difference between DCA and lump sum correctly.

Of course, if you have a lump sum of money available then you can choose how to invest it within the three categories of lump sum, DCA and buying on dips. 

If you choose to lump sum, you run the risk of the price moving against you in a short period of time, so yeah you have described DCA as potentially offsetting that risk, but it does not completely offset the overall risk of the investment, just the risk of a short term investment that might end up being wrong and ONLY if the BTC price subsequently moves agains you.  On the other hand, you also run the risk that the price might move in your favor. which would not be a risk, it would be considered a benefit of lump summing... so maybe DCA offsets volatility risk even though it does not completely remove portfolio risk and it even disadvantages you if the BTC price goes up.

In other words, DCA does not stop the risk, except perhaps just the short term trade off between investing the whole amount right away or spreading it out.. and it is not always advantageous to spread out the investments, which maybe is part of the justification to figure out some kind of balance between buying BTC right away or waiting for a dip or waiting for various time periods to pass so that you can manage your cashflow better if you BTC buys are spread through the month rather than happening all at once each month.

Now, if you have $100 per week coming in that is available for investing into bitcoin, then you could invest it all right away. and that is frequently called DCA, but it may well be semantics in some sense to not call that lump summing, especially if you buy right away.. 

If you receive a $3k bonus three times per year that could be available for investing into BTC, then that could also be considered DCA if you use it all right away to buy BTC as soon as you get it, even if you are choosing to invest it all at once each time it comes in and your are calling your practice lump sum... but you might also consider dividing that same $3k into three and investing $1k right away, spread $1k for buying on dips and spread the other $1k over a period of time such as $200 every two weeks for five installments.


Yes.. it does not seem so reasonable to divide $100 into three parts, and even less reasonable to divide $10 into 3 parts even though it is possible to do so... but the fees sometimes will make it even less feasible to divide smaller amounts into several parts.
 

This is all true, and many of the times you can take the money from a lump sum that is available or you could take the money from cashflow that is coming in, so you might measure what is the difference between the amount that you have coming in and your expenses (which would be your disposable/discretionary income), and if you try to use high portions of your DCA for buying BTC or any other investment, then you may well get yourself into trouble... so if you were to end up engaging in some kind of automatic DCA, then you would want to make sure that the amount is reasonable and not going to lead you into trouble... yet at the ame time, I am personally a little bothered by some of the automatic DCA systems since they may well not permit you to choose the exact time of your purchase, so anyone using automatic DCA might want to consider if they are doing the DCA buys at a certain time of the day or are they allowing you to customize your automated DCA buy time.

You have provided concise explanations of the advantages and disadvantages of lump-sum investment vs DCA. While lump-sum investment can be dangerous in unfavorable market situations, it can also result in large profits in favorable circumstances. By spreading out your investments across time with DCA, you lower your chance of losing money in the event of a market collapse. However, if the market takes off, you might pass on the chance to make a significant profit

When determining which strategy is ideal for you, I believe it's critical to take your long-term objectives and risk tolerance into account. It's also important to remember that DCA may be more practical for people who lack a sizable sum of money to invest all at once.


The decision of how much and how often to invest is one of the most essential elements of DCA. As an illustration, you may choose to invest a certain sum of money each week, month, or quarter. Rather of investing your entire savings all at once, the goal is to spread it out over time. This strategy can result in lower total expenses and helps to moderate market volatility. Another tactic is to automate your DCA plan, which would cause frequent automated transfers of funds from your bank account to your investing account.


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Being able to buy back after taking profits is the major challenge some people face especially those who are following the  four years cycle. Lets put it to perspective. I remember many people who rode the wave of 2021 bull run and made so much money liquidating their Bitcoin which they bought at very cheap prices. As of today, most of them do not have any Bitcoin to their name. Some that because millionaires are were fondly celebrated as Bitcoin millionaires then are not holding Bitcoin today instead some bought shitcoins because they want to make x1000. I equally know some of them that started their own crypto project with part of the money they made from selling their Bitcoin in 2021; they did this hoping to cash out big amount and also answering founders. There are so many stories about people who sold during the bull run of 2021 but the summary is that a lot of them are no longer holding Bitcoin where some also have lavished the money in frivolities.

I don't know those who became richer in Bitcoin following the four years cycle of Bitcoin. Unless they are keeping it top secret which is also possible. Personally, I do not feel I can effectively follow the market cycle to avoid making a mistake.

There are ways to attempt to invest somewhat blindly in dip-buying too, which would be that you set ladder buy orders.  I had already given such an example, but maybe I can try again.

Let's say that you are brand new to bitcoin, and over the past 10 years, you have built up about a $50k investment portfolio in various other investments, and so your annual income is about $40k per year.. and so you have right around 120% of a year's worth of income in your investment portfolio. Let's say that you also have right around $3.4k saved up in cash that you can invest into bitcoin (or anything else if you wanted to, but you have already decided upon bitcoin), and you make enough that you can invest $100 per week ($2,600) over the next 6 months.

So if your total investment allocation for bitcoin is $6k for the next 6 months, but you ONLY have $3,400 in cash right now, you could decide to invest half ($1.7k) of your available cash as a lump sum and the other half ($1.7k) to save for buying on dips, and so you can set those buying on dips however, you like with a possible expectation that you are not going to use up all of the $1,700 in the next 6 months... .but if you are considering that the current 200-week moving average of $30,750 is at or around the bottom, then you might want to structure your buys around that.  So for example, if you made your initial lump sum buy of $1,700 at $43k, then maybe you could structure your buys down from $41k to $30k.. which would be 11 buy orders ($155 each) if they were every $1k, and that would be right around 17 buy orders ($100 each) if you structured them every $750. and so you can set up your buy order increments and your amounts however you like in order to dedicate the remainder of your cash for buying on dips.

So right now, you might not know if after 6 months you would have had invested all of your $6k into BTC which currently would be right around 11% of your total investment portfolio (that is $56k =( $50k + $6K))... and maybe if you had not reached such a target, then you continue to invest $100 per week into bitcoin until you reach whatever might be your target. and you can move around your buying on dip amount if you want, and including other kinds of flexible ways to continue to maintain some buy orders that are dedicated to buying on dips while at the same time having had exercised lump sum and also incorporated buying on dips... so you are doing all three, even if you are a newbie to BTC investing.. but you are engaging in planning and also perhaps creating goals in terms of how much of a BTC allocation you would like to target, and of course, if you continue to learn about bitcoin as you go you can also reassess your plan as you go, so even though you have an initial plan for 6 months, you could extend it or you could add new terms to it based upon your learning along the way and maybe even some various things going on with your own finances and/or psychology (or even your assessment and reassessment of your 9 factors).


You are likely never going to be 100% sure.  You can invest, and surely the more that your portfolio goes into profits and the more cushion that you might have, then you might start to build greater and greater confidence that you are on the right path and you are doing the right thing.  Even though you never were investing in  the dark, you were always investing based on probabilities and some level of confidence that bitcoin is an asymmetric bet that is worth considering some kind of a reasonable allocation, whether that is in the ballpark of somewhere between 5% and 25% or if you choose some other allocation level based on your own assessment of your circumstances.

 

When I was new to Bitcoin I used Lump Sum technique. But with time I came to know that DCA is another way and when I tried I came to know about its benefits. I think it take time before people understand DCA and Lump Sum.
The only problem with dips is that we are not sure when they are occuring. Figuring out the dips is most crucial part if you are investing in "buying on dips".


I agree that being strict is more easy because you have to follow one straight path and you don't need to look for DIPs or any other variation in price. If you are following one strategy then you need to have faith in that strategy that it will suit you. Like if you are following DCA then you need to be sure that this will benefit you in the long run.
All this will be clear with time as you invest not only your money but your time and mind in Bitcoin.

Firstly as a newbie in Bitcoin, some of us where first talked on how Bitcoin will overnight makes a person wealthy by making 100x of one's investment untill I began doing more research and perherps get to join this forum then understood how the system works now. The most interesting facts about Bitcoin is the entrustment of one's funds without a doubt of it falling out and with time the investment makes profits from the holdings.

For sure the map shows the role which the four years cycle plays in Bitcoin but I disagree with the bolded statement because most people do not really understand the four years cycle of Bitcoin but it's really favouring them through the help of DCA. For instance I never knew of the for years cycle of Bitcoin but I know about the volatility of Bitcoin so after reading some threads like buy the dip and hodl I quickly adapt to DCA strategy of accumulation without understanding the Bitcoin cycle and I have been accumulating Bitcoin for some time now and I'm get favour from it because it's convenient enough to allow me take good care of other bills.

What I'm saying in essence is you do not necessarily need to understand the four years cycle of Bitcoin before you get favoured from it. as long as your practicing a favourable strategy you can also be a long term winner without understanding the four years cycle of Bitcoin.

I don't know any thing about how much Bitcoin will do this time, so I will only follow some few guides in this forum for sustainable Bitcoin withdrawal strategy in order not mess my targets up.

You know, the first line of your sentence seems to be a criticism but I will skip that. the sad truth is nobody makes decisions for anybody so it's in your court to play your ball but I will not be a party to regrets. although its good to enjoy your profit I mean what's the need to invest if you won't make use of the profit and like someone once told me life is too short to be unhappy so make your self happy. but even before investing you should know that what you're investing is an amount that you can do without for a long time so if this has been put into consideration then you wouldn't be think of touching your investment at any point soon.

Note; don't mind my English only take the message.