"Lump sum Vs DCA" for Bitcoin Accumulation - page 3.

Die_empty

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Quote from: snowpega on October 19, 2023, 09:10:15 AM

End: it is my part over the discussion "DCA Vs Lump-sum" So, Please must share your thoughts, opinion & Knowledge over this topic "DCA Vs Lump-sum" to make this thread useful for me and my other beloved members of the Bitcointalk community.

-snowpega-

I know many people will choose Dollar-cost averaging because it has some advantage over the Lump sum style. DCA helps to spread your investment risk and it also makes people invest conveniently without much pressure. It could also help to reduce bad timings of purchases. I see this DCA as little drops of water that can fill a bucket with time. But you cannot avoid lump sum strategy especially when the bitcoin price is low. I have been adopting DCA for some time now but whenever bitcoin price is down and I have the money to buy, lump sum strategy will be my best option.

Generally, DCA is the best option for newcomers who have little or no knowledge about the movement or operations of the market. However experienced bitcoiners can benefit from the market using the lump sum strategy. So there is a need to be flexible in your investment plan and not stick to one strategy, but always do your research before taking any decision.

_BlackStar

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Lump sum and DCA are just two terms for investment strategies - but they are also mutually beneficial if you are a long-term investment holder. Someone who can save $200 at the end of the month can invest with lump sum 1x/ month - especially during a dip. They can do it consistently with the same amount every month - meaning they also do DCA 12x a year with $200 every month instead of buying $600 every 4 months.

I actually don't have a problem with the two strategies above as long as they are long-term investments - that's because the end goal is to generate profits. It takes good analysis to determine whether you need to buy a lump sum or do a DCA to get a lower average price - but I can combine both and adjust to market conditions.

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Quote from: _act_ on October 19, 2023, 09:20:33 AM

DCA is good, but there are sometimes that you will leave DCA alone and invest big amount. Let us say that you have been DCAing since some months ago and the price of bitcoin within one week fall to $20000, if you have money that you can use to invest at once, you will not hesitate but invest it immediately becuase you have speculated that bitcoin price may not fall further.

DCA is good when you do not know if the price of bitcoin will not increase or decrease. Or if you do not have enough money to invest at once.

You may invest at once if you analyzed the price of bitcoin is low already.

Investors may go for either of the two, it is what the price of bitcoin is at that will determine that.

There is also a time that investing is not good, when bitcoin has increased significantly several times.

If you are doing a 100$ a week DCA that is 5200 in a year. and 10,400 over 2 years.

You should have a 2 shot lump sum set up. say 2600 two times or a possible 5200.

If you get a 15% drop or a 20% drop do the 1 shot. Hold the other back

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Quote from: snowpega on October 19, 2023, 09:10:15 AM

Hi there! Hope Y'all doing well.

I would like to discuss this difference here with my respectable senior as well as the newbie members of the Bitcointalk Community. So, what you guys say why not we all should put some light over this discussion by sharing our opinion and knowledge along with our experiences.

Note: This thread may helpful to other member who just start their BitcoinBTC accumulation just now. So, Share your knowledge, opinions and experience accordingly. Many Thanks!

To be very honest, if i have to choose anyone of these i would choose DCA strategy Because we can never time bitcoinBTC market. We can just make some predictions by keeping in mind, Past behaviour & market sentiments of the BitcoinBTC along With TA and FA. i'm sharing my whole thread where i explained DCA technique with deep discussion rather than i explain the whole DCA strategy here again.....>>>A Complete Guide for Cryptocurrency Newbies "The Best Way Of DCA".

My opinion is to use DCA strategy for bitcoin accumulation because Bitcoin market sometime in dip and sometime in up behavior. we can't time the market anytime. So, while using DCA strategy we need to stay consistent and keep investing short amount of our money after interval of time "time interval can be weekly, bi-weekly or Monthly as well". In this way, we will get opportunities to buy dips and ups both being in the Bitcoin Market which at the end of the day gives us a good Average of our investment.

On the other hand, Lump-sum investment can be useful and maybe not. As i aforementioned that we can't time the market. So, what will happen using this strategy for BTCBTC accumulation? The person will buy Bitcoin at higher price or maybe at lower price with full of his investment at the same time. Sometime, he/ she fell prey to FOMO because he/she is waiting to see more dip for his accumulation of Bitcoin. In case, if it do not happen like price will not go more down he/she will miss his/her great opportunity of buying. Why i don't like Lump-sum investment because we have to invest our whole amount at the same time for accumulation of BTCBTC.

Many Of the people fell prey to FOMO while investing in the market and their way to accumulation of bitcoin. So, To overcome it you can read this thread as well because knowledge is the power in cryptocurrency world. A Guide for Cryptocurrency Newbies for Overcoming FOMO

End: it is my part over the discussion "DCA Vs Lump-sum" So, Please must share your thoughts, opinion & Knowledge over this topic "DCA Vs Lump-sum" to make this thread useful for me and my other beloved members of the Bitcointalk community.

-snowpega-

The main thing and a key to success is to invest in Bitcoin. It doesn't matter how, both "lump sum" and DCA ways are good. You can lose or gain something insignificantly but it won't change the ultimate outcome considerably. Just buy any way you like and hodl and you'll be good.

Gaza13

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In investing there are various strategies used by investors, the right choice will determine our future results, as we all know in investing prices are very uncertain and very fluctuating. Lumpsum Technique: This strategy is where investors invest large amounts at one time. This technique is also good for investors who are patiently waiting for the timing when we determine the best price. This technique also has advantages or benefits if we are right in determining the price to buy it. Dca technique: This strategy is where investors routinely accumulate every month. This technique also makes us disciplined in investing and also gets the best average price for investing.

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Quote from: snowpega on October 19, 2023, 09:10:15 AM

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DCA should be in the basic strategy of every investor to accumulate more bitcoins to what they have. Lump sums for investment will not always be available, and if you choose to always wait to invest lump sums, because of how long you may have to always wait to get and invest the lump sum, sometimes someone who is a committed DCA-er and DCA-ing reasonable amount regularly would have accumulated more (Not in all cases though, as it depends on the amount of lump sum and amount used in DCA).

If you invest Lump sum as well, you will have your attention a lot focused on your investment. You will not be a relaxed investor, unless the lump sum invested is still an amount you can afford to loose like when you are already wealthy.

DCA as an investor in bitcoins, but also be flexible enough to invest Lump sums at intervals if you can. The goal is to get more bitcoins, any legal way to accumulate it is accepted.

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So anyway, I applied as a merit source :)

I would go with the lump-sum, assuming you mean a big amount when the price drops. That once held for long gives you enough price to sell at a decent profit. This means that instead of buying every month in DCA you buy once every 4-6months during a bear market and you sell like that in a bull market. Use the profit to buy back at the next bear market and continue to multiply your money.

This needs patience and by that I mean a lot of it. Fortunately I can do that because I have other sources of income. So that cushioning is needed for anyone attempting this method.

Sim_card

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Lump sum is done by rich investors, so that they can buy once and forget about buying regular by splitting the amount into fractions for DCA. I don't think that people that buy with lump sum cares if the price goes dipper than the amount that they bought because as long as they are investing in a long term, they will definitely make profit. It is a poor investor that if he manages to gather his money for a long period of time and buy bitcoin once with it, that when the price dips below what he bought might not be happy with his decision but as long as he is holding his bitcoin for long, he will make profit. DCA has proved to investors that it is the best stratgy in which you can use to balance the equilibrium in your accumulation, by buying at regular at various price to keep on increasing your portfolio. What I know with this two strategy is that someone who uses DCA method to accumulate his bitcoin, will have a higher chance to increase his bitcoin portfolio, than some who buys in a lump sum. Lump sum is good when you have the luck to buy at the bottom line of the dip.

Faisal2202

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I cannot agree more with you. I almost read every topic of yours, and they are really refreshing for me. I also did a search on these topics when I was new to the crypto field, but your way of memorizing those topics by writing them down here is better. It will enhance your and other newbies' knowledge.

DCA is really a great strategy. I have done it; I receive some amount in my wallet every week, and that's my time interval for DCA, and so far, what I do is withdraw some amount from these weekly earnings to meet my personal expenses. And the savings I left with are already in BTC. So I can say that I am doing DCA on a weekly basis, with no fixed amount of money, as it changes according to my needs.

So far, the results of doing DCA have been very good for me, and I am really looking for the halving event because it might give me 2x or 3x. That's the least I was expecting. I hope everything will go as planned for all of us. Well, the point is, DCA is helpful, but for those who have weekly or monthly earnings and don't have a pile of money, they don't have the choice to go for lump-sum while all they can do is just DCA. And in my situation, I can only do DCA, as I don't have enough funds to do Lump-Sum.

Quote from: snowpega on October 19, 2023, 09:10:15 AM

On the other hand, Lump-sum investment can be useful and maybe not. As i aforementioned that we can't time the market. So, what will happen using this strategy for BTCBTC accumulation? The person will buy Bitcoin at higher price or maybe at lower price with full of his investment at the same time.

I won't say that they invest all of there funds, because the best practice is to keep some funds for emergency. Either you are doing DCA or lump sum.

spectre71

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It's not an all or nothing thing. Hybrid. Partial lump up front and DCA the remainder somewhere on a point to your target date. I am not afraid to secure some profit while still maintaining a DCA input.

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Quote from: Cantsay on October 19, 2023, 09:56:43 AM

All I can see from this thread is DCA, DCA.

I believe that it would be a great idea to also be nice to add what “lump sum” is all about. Because I can say that at this point 60% of people that comes to beginner and help board, as well as bitcoin discussion board should be aware of what DCA means and also know the benefits that’s attached to it But most of them don’t know what lump sum is, so it would have been nice to include it in the op.

That's because DCA is the most common strategy for Bitcoin accumulation. By investing a fixed amount of money on a regular basis, regardless of the current state of the market. It's a good strategy that makes you disciplined in terms of investing. Unlike in lump sum investment, which is purchasing bitcoin in one go, can cause a high possibility of missing on purchasing at a lower price. Also, lump sum investment is only applicable to those people who do not have the time to check their investments regularly.

mk4

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As far as I know — in most cases, lump sum is the way to go assuming you can really just hold and not sell and attempt to buy lower. The sole reason why DCA is heavily recommended is because it makes the 'investor' less susceptible to huge (temporary) drawdowns. Some investors that are down a huge chunk tend to sell their stack to hopefully "buy back lower".

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There are a lot of people who dwell with this theory and IIRC, it's DCA who won in the long term. I think also that that is the best way because you don't need to time the market and you just accumulate and accumulate and see if you need anything or not. More and more you can do it if you just don't convert any of the crypto that you will get and I believe that you would have the best result when you don't time it.

Basically it's
Lump Sum = Higher return in a year, more timing
DCA = Good return, less need for timing

If you are really analyzing the market, I think you would be good at a lump sum, but if you are just an average joe, it's best to buy continuously.

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Quote from: Cantsay on October 19, 2023, 09:56:43 AM

All I can see from this thread is DCA, DCA.

That's because virtually everyone does DCA in one of its variants. Even Michael Saylor does it.

Quote from: Cantsay on October 19, 2023, 09:56:43 AM

I believe that it would be a great idea to also be nice to add what “lump sum” is all about.

It is simply that you have an amount to invest at once. Like if you have a million dollars and you buy it today in bitcoin. Doing DCA would be for example buying $100,000 over the next 10 months, that way you cushion yourself against the swings of the market. If the financial asset is good, both are valid because in the long run it will go up.

Cantsay

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All I can see from this thread is DCA, DCA.

I believe that it would be a great idea to also be nice to add what “lump sum” is all about. Because I can say that at this point 60% of people that comes to beginner and help board, as well as bitcoin discussion board should be aware of what DCA means and also know the benefits that’s attached to it But most of them don’t know what lump sum is, so it would have been nice to include it in the op.

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Quote from: SquirrelJulietGarden on October 19, 2023, 09:39:14 AM

Quote from: Apocollapse on October 19, 2023, 09:32:48 AM

If you buy Bitcoin in Monday for $200, but the next week you skip because Bitcoin price is rising and you think it's expensive, so you will buy it after the price slightly drop. It's not DCA anymore.

Are you sure it is no longer DCA?

I see it is still DCA even you can not make your buying at exact time as you initially scheduled. DCA relates to your available capital that can be broken some times. When you don't have available capital like losing your job or just have some urgent need, you can stop your DCA. Fortunately, you can restart it anytime later and your whole long process is still DCA.

While I might have to agree with you on DCA not being very timely or periodic even though it needs such attributes, it is also dependent on the reason for this break or not having to buy at an opportune time when the capital is readily available but, you choose to let it slide.

From your previous quote (the quote from Apocollapse), it’s states and I rephrase that; having to skip because Bitcoin price is rising* emphases on rising price as the reason for skipping, then it’s no longer DCA strategy. That’ll be you buying based on how cost effective it might be for you. DCA has got no vacuum to consider price, it’s you buying at any price and at any time.

SquirrelJulietGarden

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Quote from: Apocollapse on October 19, 2023, 09:32:48 AM

If you buy Bitcoin in Monday for $200, but the next week you skip because Bitcoin price is rising and you think it's expensive, so you will buy it after the price slightly drop. It's not DCA anymore.

Are you sure it is no longer DCA?

I see it is still DCA even you can not make your buying at exact time as you initially scheduled. DCA relates to your available capital that can be broken some times. When you don't have available capital like losing your job or just have some urgent need, you can stop your DCA. Fortunately, you can restart it anytime later and your whole long process is still DCA.

Micro Strategy do their DCA and do you see they buy Bitcoin every first day of each month or each quarter?

See their Balance sheet history and dates of buying times.

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Quote from: Bitcoinpoly on October 19, 2023, 09:28:02 AM

DCA is good actually but not everyone knows how to use it. As for me I like DCA but for real i don’t really know how to use it, so I use smart portfolio.

DCA(Dollar Cost Averaging) which simply means buying in multiple price to average your buying price. You can simply purchase Bitcoin on specific time intervals depending on your preference. Purchasing Bitcoin on different time or price is considered as DCA. There’s nothing complicated about except you are pertaining on DCA trading which exchange offer nowadays.

In general, DCA is just consistently buying on the your set condition whether on the price or time interval that will average your buy price.

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Quote from: Bitcoinpoly on October 19, 2023, 09:28:02 AM

DCA is good actually but not everyone knows how to use it. As for me I like DCA but for real i don’t really know how to use it, so I use smart portfolio.

DCA isn't something that you need to use strategy or skill to do that, what you need is only consistent.

Consistent if you buy Bitcoin every Sunday at 7.00 AM for $500, it's already DCA.

If you buy Bitcoin in Monday for $200, but the next week you skip because Bitcoin price is rising and you think it's expensive, so you will buy it after the price slightly drop. It's not DCA anymore.

_act_

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Quote from: Bitcoinpoly on October 19, 2023, 09:28:02 AM

DCA is good actually but not everyone knows how to use it. As for me I like DCA but for real i don’t really know how to use it, so I use smart portfolio.

There is nothing hard about DCA. It means dollar cost average. Not necessarily dollar as it can be in your country's local currency. All you have to do is to be using certain amount of money to be buying bitcoin every week or every month. But people use to refer to it as buying bitcoin every week. With that you will be able to buy bitcoin at varying prices.

Topic: "Lump sum Vs DCA" for Bitcoin Accumulation - page 3. (Read 663 times)