Topic: You will lose more if you DCA without knowledge (Read 492 times)

We need to have adequate knowledge in order to know how to use the DCA strategy because if you are familiar with this genuine strategy " Buy Low and Sell High", you are definitely in good approach.

Have to understand that not all things can be learned in just a single day but can take several days and market experience. We don't need to perfect and make no mistakes, it is impossible in a volatile market. Losing will just happen to anyone who sells their coins at a lower price than the price we bought them. DCA is not a wrong idea but what went wrong is when we are in the wrong timing (buying) because some people buy high and sell low due to FOMO and panic.

The ops may have misconceptions about what DCA mean and how to apply it, but from what I can understand from his statement what he is referring to as DCA is, buying the Dip and selling the top, although he will be using dollar to execute such trades but even at that we still have to understand the real terms behind DCA and how best we can apply it to better our overall experience.

Secondly also i suggests that the ops should spend sometime more in studying and learning newthings about what is DCA and how it works so that he can have a better informed background knowledge of the subject matters before writing a concept as he presented.

It is true that if we want to succeed in any task, it is best to acquire enough knowledge about that task. DCA method of investing is best for investing. However, if you acquire a little knowledge on investing and invest with the DCA method, you can be successful. Now if you want to profit from investing in Bitcoin with DCA method, then you need to continue investing with DCA method for long term. Now if you follow DCA method in short term then you will not be successful. If you can continue investing in DCA method for long period of 5-10 years then you will definitely be successful.

DCA is an ideal method for depositing bitcoins because it is relatively simple. You get the opportunity to deposit as per your ability on weekly or monthly basis. Here you can expect real profit only when you can continue DCA for long term and continuously. If it is short term you will not get your desired profit. I have not found any risk in depositing bitcoin through DCA.

I think you don't really understand what DCA approach is mate, because DCA actually saves you from such speculations, DCA is an investment approach whereby convinced that you're unto a good investment, you increase your portfolio on a planned periodic activity irrespective of the price hike, price fall or market speculations of such investment.  You tend to buy when the price is high, and also when its very low thereby striking an average value of your investments by combining both the purchases done on each trends and you'll see that you buy more on the lower trend which means gains for you over a longer period.

DCA is for everybody and it suits those who are investors and not just opportunists, you tend to grow your portfolio bearing in mind that the investment will appreciate and give you great ROI at the long run, its an advantage for those who wish to accumulate, but cannot do it using lump sum, they accumulate periodically until they have achieved the same quantity or even more that they would have bought using lump sum. That time you've achieved your investments target using a slow and steady process which is what DCA is all about

DCA is actually the best for newbies and those without expert knowledge to study the markets. For example in bitcoin investment, its only a professional with adequate knowledge of bit bitcoin history and price movement that would know exactly how to buy the dip. A beginner with limited knowledge would be lost and DCA would help him/her to buy both the dip and the pump thereby striking a balance between the two.

Let's have an example here
A salaried person embarks on the journey to accumulate bitcoin from the start of last year using DCA and wishes to invest $100 monthly and his colleague who wishes to save same amount and buy by the the end of last year, when the market price would be low.

Month            price.               Unit purchased
January.        $20,236.             0.004942
February.       $23,147.35         0.004320
March.           $28,478.48        0.003511
April.             $29,268.81        0.003417
May.              $27,219.66        0.003674
June              $30,477.25        0.003281
July               $29,230.11        0.003421
August           $25,931.47        0.003856
September     $26,967.92        0.003708
October          $29,755.90       0.003360
November      $37,712.75        0.002652
December       $42,265.19        0.002366

Total accumulations        0.042481‬

you can observe the various price fluctuations during the various months purchases and where he was able to buy the dips as well as the pumps and gradually, he was able to accumulate $1,795 worth of BTC instead of $1000 which his friend will likely purchase at the end of the year that is if the friend ended up buying with the price hike. He achieved his target DCA accumulation and recorded almost 80% gains without bothering about the price movements or being a professional. It will interest you that this same investment is now worth $2,703.

I guess you wanted the quick profit using the dca strategy to accumulate bitcoin. If no, I don't get why you'll speak such about dca strategy and sincerely speaking dca strategy is so common and favourable for investors who choose to invest in bitcoin, you don't necessary need to start with a wrong impression or else you'll paint every accumulation strategy as same. Dca strategy is used to accumulate monthly or weekly with any amount of your choice so long as you have the basic knowledge about bitcoin and dca. You have to bear some certain things knowing the kind of investment choice (bitcoin) with a volatile nature, planning is always needed alongside with your investment although I don't know what's triggering this thought but dca is one of the best and popular strategy for accumulating bitcoin

I can understand your view point given that, this post is just a week in and the price of Bitcoin have lately been heading towards the bears. I was frankly surprised how far it’s gone when I looked at the charts today but, that’s not all that is to say about the DCA strategy. If you tend to look at what the price of the coin is doing in the market before you take a buy, you’re not doing the dollar cost averaging no more.
You’re simply looking to buy low and sell high, opportunity cost and that’s not DCA.

DCA does more of looking at what funds you’ve got to invest and don’t care much about the price. Also, you don’t lose if you haven’t sold. That’s how hodling works! You only lose after you must have sold at a low after buying high.

That’s why, 1BTC = 1BTC. You’ve still got your Bitcoin and all you need to do is wait for the price to appreciate in a way that, it brings you into profit before you think of selling should you even sell at all.

You want quick profit and that's the problem, you don't even understand what DCA means because if you do you won't be expecting profits fast, you will even be hoping that this correction stays longer than most people wanted, so that you will have enough time to accumulate as many Bitcoin as possible.

There are many investors in crypto space today that aren't suppose to be here, crypto investments doesn't suit people like them, they are better off running a business that will bring them passive income everyday.

While people are feeling sad about a correction, it is a calling for me to start investing, I have been using DCA even when Bitcoin was trading for 70k but my DCA method increase in value once the bears attacked the market, which is the way it is supposed to be.

We definitely need experience to invest but there is no problem if you have little experience to invest in DCA method. Because the Dollar Cost Averaging method is a recommended and easy technique for beginners. People who invest using the dollar cost averaging method set a fixed average price, then buy at that price and plan to hold it for a long time by buying it regularly. As you said you lost every time you invested with the dollar cost averaging method maybe your investment was wrong. If you sell any coins you buy at a low price, you will lose money.

If someone is motivated to invest in Dollar Cost Averaging method, even if he has little knowledge about Bitcoin, he can spontaneously invest in Bitcoin. The advantage of investing in the dollar cost averaging method is that you buy whenever you get the chance and keep accumulating bitcoins regularly.

I am not an expert yet in bitcoin investment but from what i have read and understand so far DCA strategy is best suited for beginners and don’t require any special knowledge to adopt the strategy so once you understand how to implement the strategy then i don’t think there is any serious risk involved. DCA strategy entails investing certain amount at your own disposal and convenience at regular intervals from your earnings. This is the best strategy to accumulate bitcoin for beginners because it carries less risk and helps to control their investment policies of not investing more than what they can afford to lose and it is also a useful strategy for low income earners who cannot invest much in bitcoin at a go because they would be investing more than they can afford which is a bad discipline for bitcoin investment.

Maybe you are just not lucky and maybe you are not actually not DCAing and you’re not planning to hold for long that’s why you are so bothered about the dip. I don’t think DCA is about beating the price as you mentioned it’s all about investing for a long period regardless of the price. Bitcoin is bound to rise and fall in price due to it’s volatility so every investor should understand that and i think that’s the main purpose of DCA strategy, to take our eyes off bear periods and guarantee profits by holding for long periods.

I don’t know if you understand DCA properly but i am certain that you are probably mistaking it for some other strategy because the DCA i know is recommended for beginners and people without adequate knowledge price movements and market. I think you should probably refer back to your research and confirm properly because DCA is the easiest strategy for newbies since it doesn’t require any form of stress or understanding and also the risk involved is very minimal although holding for long can be more profitable.

There are three ways to accumulate bitcoin according to JayJuanGee bitcoin investment ideas which i came across few days back and they are DCA, Lump sum and buying the dip. I think reading the post itself would help you understand investment strategies better. Link is below
https://bitcointalksearch.org/topic/m.58719591

DCA means dollar cost average, u need to understand the concept before u start talking about incurring losses from the method, if u are doing DCA it means u are accumulating bitcoin gradually or periodically and as such u are not to accumulate a small and sell and be expecting a large amount of profit .DCA is periodic something and as a newbie since u u are new to crypto currency  it is advisable for u to use DCA method to accumulate a large amount of bitcoin in ur holding periodically also u may not have the capital to do lump sum .DCA method is for long term investment u buy and hold ,why buy a potential coin like bitcoin and u are in a rush to sell it off and to buy again, bitcoin is different from shitcoin.

We must have knowledge for everything but we have no idea about any subject. If we stay away from any subject thinking that it is new, then we can never do that subject. Each of us has knowledge and we must make proper use of that knowledge. In terms of investment, DCA investment method is a very effective method and those who have relatively little knowledge about investment but invest in this investment method are very successful. Since this investment method has the opportunity to invest in each step, an investor can invest at any stage of value, thereby reducing the amount of risk in his investment. It is different for those who have zero knowledge about investing but even those who have minimal knowledge about investing can use that knowledge and succeed in investing with DCA method.

It is unless as a newbie, you still don't know the best wallet to use and the best practices to keep your coins and key phrases safe, then that's when the DCA strategy is a no-no for you as a newbie.
Otherwise, despite the market situations, be it a dip or a pump in price or the trends that may be occasioned by whale movements and launch of new initiatives, the DCA strategy is still the most viable and profitable crypto investment strategy, mostly when ones income stream is on a steady basis and there's a good budget adherence discipline.

As far as I know, getting attached to DCA is the most effective way to accumulate bitcoin without taking so much risk. You are constantly buying at a minimal price regardless of the price of bitcoin, which enables you to store maximum amount of bitcoin by not spending your lump sum money but by consistently using your spare money to invest. With that, I have not seen any disadvantages with that even from a newbies point of view. But still, at least you should know the essence of DCA as well before you decide to practice it.

You don't need whatever knowledge that you're taking about to DCA, what you need is a steady income so you don't lose track of what you're doing. There's no way DCA is going to be the worst mistake a newbie will make. DCA is perfect for both newbies and experienced investors. You'll lose when you don't hodl your stand to keep DCAing but you decide to take profits when your Bitcoin investments is still prematured. Volatility of the market shouldn't affect your DCA strategy but you should increase your investment capital when the market is down, it's during this peridot that you should be investing more knowing that you'll be getting a discount price for your purchases.

It's called dollar cost averaging because you're averaging the price of the product that you're buying. You can't lose but always be in profit if you're DCA for a long duration and that should be the timeframe of your investment in Bitcoin and any other assets that you're buying. If you're thinking about the investment period being a short time then just buy the asset's at ones to avoid yourself all the stress of monitoring the market.

Let me tell you on a short note OP, DCA accumulating process is the best for Investors and I don't think if there's is an advanced knowledge needed for it. You only need to figure the current value of bitcoin and purchase when it seems lower than you formally withnessed or as your conscience may lead you via market suggestions or predictions.
You can as much purchase your bitcoin on a gradual process base on the volatility markets system at most when the value is depreciated but when you ignore to understand this market volatility then I'd say you haven't been on the right track of the DCA approach. Therein you actually need to understand rhe market volatile grades so you don't fall to buy more to your holding when the market is up high rather than when it's low in value.

Sometimes you newbies are the causes of your emotional regrets because you don't feel comfortable buying then the market is not cheering profits profits profits without knowing it's the most right time to buy, instead you bumps into the market when you hear others of making huge profits in the market in a main time and only then you're attracted to buy. Although it's not a bad time as well but be assured that bitcoin is most beneficial to the long time holders so whatever value of bitcoin in have accumulated, you're potential to make lucrative profits in as long you can hold for a long period of time.

Actually, it depends. I want to ask what you understand about DCA. The dollar cost average method asks you to invest a portion ever week without looking at the price and you should continue for a long time to have a good average buying price. But if you do it for let's say only ten weeks and expect a good result out of it, you didn't get it, buddy.

I consider my signature payments as DCA and it has paid out well. My average accumulating price was around 27K, which went up to 41K due to the recent spike. Yet I am in a good profit because I was doing it for a year. Now, if you start buying only since the last two months, you won't get the profit bro! You should learn more about it.

DCA is a good method for buying, holding to get profit but to get profit, it requires more than DCA.

Because it relates to capital management, financial life management of a person. Start with what is source of money used for the investment and what is financial reserve for life, for emergency and more. If a person has bad managements like borrow money to invest, invest all money in bitcoin, panic sell will come or forced sell will come when needs of money occurs.

With bad start like this, it will be very challenging to control emotion, psychology and actions.

DCA is not an investment strategy, it's a buying strategy. It says nothing about taking profits, so if you lose while investing with DCA, you most likely do some bad moves like panic selling, or selling in bear market.

DCA is not an efficient strategy though, it is being recommended for its psychological effects of doing small steps, which is easier for many people than investing big in one go and then worrying every time the price moves.

Are you by anyway trying to twist my brain or something else?
Because i still don't understand what you mean by newbies staying away from DCA does it mean that those who has been doing DCA all these while have been losing money or what, meanwhile we all know it to be the safest and easiest way to accumulate bitcoin when the market seems so hash on investors and to those who has missed their train to hold more bitcoin. Please DCA still remains the best for everyone, it just depends on the individuals who is doing DCA, but before you must need to make personal savings where you don't need to touch your bitcoin along your DCA process otherwise you could be tempted to start reducing your DCA level.