Since I last posted I have learned something about my self, some people might draw parallels or may have already learnt this about themselves. I was angry that the price went up, and it was the first time I was angry at BTC price even throughout the bear of going/dropping down. I realised too late I hadn't fully prepared for Uppity. I thought I had, I thought I would be happy with double digit value returns. I could handle other asset returns across other investments so why couldn't I project that confidence and experience to BTC. Well what caught me completely off guard was the suddenness. In most if not all other asset classes value add is gradual. You know you build wealth slowly, but like 5K$ increase in BTC price threw me into a loop. I was more angry I hadn't invested more at lower levels than the fact i had just got more returns from one asset in a day than any other asset I have ever owned. The magnitude of that was drowned out by my anger.
Well why I am writing this, what happened, what did I learn. Pretty simple I didn't fully understand, when people said be prepared for uppity, what that meant. I also put too much of my investment money looking at a bargain. I should have put it 100% into dca vs split of DCA and BTFD. I fooled myself into thinking my system was flawless because i didn't prepare for uppity properly. I went back through all my BFTD buys and then compared this to increasing DCA during the same time period. DCA would have out won with this 5k$ uppity.
Shifting my strategy I'm not going put as much emphasis on BFTD vs DCA for a while, there is more severe uppity to come but I have learnt my lesson.
Stay calm, learn shit, and dca on.
For sure, preparing for UP can sometimes be easier said than done, and when then time comes, it becomes quite concrete, and sure the BTC price might dip again.. but then again, it might not.
And, you described a $5k rise, and sure you may largely be correct, because maybe it went up $5k more than what anyone expected, but the fact of the matter is that it went up right around $9k in the last 2-3 weeks from the upper $26ks into the upper $35ks, and sure so far we have had some dipping back down to the lower $34ks, and yeah we could get some more dip, but we might not.
If we failed to prepare, we can ONLY go by what happens to be our current situation and to attempt to rethink if there is anything that we should do to adjust, or to just keep with what we had done and just attempt to learn from the matter. Sometimes attempting to correct a mistake after it already happened might exacerbate the mistake rather than learning from it so that you are ahead of similar kinds of potential mistakes.
I use this example frequently, but sometimes a mistake can take several months to recover from it.. and maybe even years, so my example is that in October/November 2015, when BTC prices went up from the upper $200s to $500, I did the opposite to what I was supposed to do which was that I continued to buy up to $500, instead of selling or just HODLing.. Of course, I had already considered that I had gotten into stages of overaccumulation so I was supposed to sell small amounts as the BTC price rose, but instead I bought..so even though I scrambled to put some money together after the BTC price dropped back down to $300 and then got stuck in the lower $400s for more than 6 months, there was a bit of locking out and even perception of mistake until the BTC price went back above $500, which was the end of May 2016... so I am not really trying to bring up the idea of selling, but instead the idea that making mistakes can sometimes screw up otherwise good plans for a decent amount of time if we had a plan in place to be in front of price movements and instead we jump straight into the wrong kind of conduct that was not part of our plan and then we later realize that we screwed up.
Thanks JJG, if I boil it down to one thing I think got a bit too caught up in bftd to lower my avg buy-in price when I should have been more consumed with pure accumulation through dca. Avg price is just not that important when I really thought about it because it will even out as you dca to your target. Just right it’s probably at its lowest price for a while and will continue to climb through this cycle.
It’s a valuable lesson to be fair and the only good thing I suppose is I was still accumulating just not as much as should have been. I ended up pulling all the lower buys, and used to buy in end of October with last dca buy.
I think I’m more likely to review btfd again after I make it my goal amount which i estimate to happen near the end of next year.