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Is dollar-cost averaging one of the best strategies for investing in bitcoin?

Historically, dollar-cost averaging has been shown to be very profitable on almost any timeframe.

What’s your favorite strategy?

[https://www.cryptovantage.com/news/ask-cryptovantage-whats-the-best-way-to-take-advantage-of-dollar-cost-averaging/](https://www.cryptovantage.com/news/ask-cryptovantage-whats-the-best-way-to-take-advantage-of-dollar-cost-averaging/)



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21 Comments

  1. **Statistically Lump Sum investing will outperform DCA investing.**

    DCA is usually the best advice for those that don’t have the capital upfront.

    For investing in any assets = realty, stocks, bitcoin, or gold the best advice is to make a solid plan after doing your research up front, diversify with uncoorelated asset classes that are properly hedged and invest all up front. This is especially true with Bitcoin because no one can predict the price and most appreciation happens on a few days each year that are unexpected so the quicker you own BTC , the quicker you get exposure to this appreciation.

    This being said you should not be investing at all in Bitcoin unless you have paid off all your high interest debt and have at least 3-6 months of fiat in an emergency fund to cover living expenses.

    Lump sum investing outperformed DCA investing 68% of the time according to a Vanguard study –

    https://www.fool.com/investing/dollar-cost-averaging-what-investors-need-to-know.aspx

    2 reasons –

    1) stocks (I suggest an index fund like SPDR ) and BTC have an inherent upwards bias so the sooner you invest the quicker you can accumulate appreciation

    2) Inflation drag – fiat uninvested will be slowly losing value due to inflation

  2. dca is ok especially if you don’t have money in hand. so to put 100 dollars a pay religiously is good but on the flip side, it is ideal to have a good chunk of change waiting on the sideline for the right moment. Back in March when it corrected could you imagine having 20 grand to purchase 4,000 dollar bitcoin? You would have scooped up 5 btc for a steal. so yes dca is good but keep some dry powder at the ready for great buying opportunities.

  3. Yes, I agree on de-risking through dollar-cost averaging, and more advantageous investing options for the retail market are around the corner. I enjoyed the article too.

  4. I have had amazing luck with DCA, been buying crypto since 2017 and stacked quite a bit, I set aside each week how much I plan to put in and then break that up into three even amounts and buy dips that week. If you miss the bottoms no big deal, you buy a little high, no big deal, you don’t get burned on big drops and you stack quite fast

  5. Buy heavily shortly after halving. Sell when everybody is seemingly talking about it and asking me if they should buy. Just my strategy but if there was ever a market to time, the halving is ALWAYS the start or sign of near term bull runs and is a fantastic entry. The exit is a little more difficult but I knew that I should of sold when I’m reading in the Washington post about people who are remortgaging their homes to buy it.

    Other is just continue saving until you see 30% drops and pick up there.

    DCA is honestly the simplest and tax free!

  6. > Historically, dollar-cost averaging has been shown to be very profitable on almost any timeframe.

    So is a lump sum investment. The word “best” in “best strategy” depends on our goals. If you want a relatively stress free approach go for it. If you want to maximize your gains make a lump sum investment. The letter has the better expected value.

  7. saving money is a tactic used when your strategy is to save money for the purpose of doing something(s) greater with it in the future.

    dca is a tactic for saving when you don’t have an edge or deep knowledge of a market, and therefore can’t decide when is a good time to buy, but when you believe in the long term or overall vision of the asset. the goal of dca is to lessen the volatility or statistical variance your portfolio’s day to day market value. dca does NOT increase your potential gains. it merely smooths the curves. if your vision is truly long term, then the daily ups and downs shouldn’t really matter.

What do you think?

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