Quote from: Salahmu on March 17, 2024, 06:41:19 PM

Quote from: JayJuanGee on March 17, 2024, 03:45:56 PM

[edited out]

However in terms of short-term investment I agree with you that most people normally get confused or couldn't distinguish between short-term and long term investment because one of the things I realized is that most people or rather investors feels that holding Bitcoin for six or seven months is a long term holding without knowing that they are only doing there normally trading because like you said a long term holding could be refer as holding Bitcoin for ten or more than ten years.

Yeah, sometimes we might be confusing the definitions, and it seems that bitcoin has a bit of a pattern that justifies the consideration of the 4-year cycle, even if the cycle may well end up getting broken at some point... however, if we already have a pattern of a 4 -year cycle, then, it is likely helpful to at least attempt to recognize that such pattern has so far tended to play around the timeline of the halvening.

So yeah we do not necessarily need to plan out 10 years or more in order to be considered long term, but if we really consider what people might want to do with their investment into bitcoin, then we likely can see that they are wanting to make their lives better in the future.... so yeah.. I suppose that there could be such things as long term, medium term and short term trades, and so any one getting involved in bitcoin for less than 4 years could be trading within various periods of time, yet it would be difficult to classify them as an investor in bitcoin if they have a timeline that is shorter than 4 years.

Quote from: Stablexcoin on March 17, 2024, 11:27:06 PM

Quote from: JayJuanGee on March 17, 2024, 06:02:24 PM

In traditional investments, there is generally a recommendation that you should be able to withdraw 4% per year from your investment portfolio and to be able to withdraw at that rate forever, so long as, on average, your investment is growing in value at least 4% per year.

I guess it is the 4% rule of investment you are talking about. Imagine your portfolio balance is not increasing due to price fluctuations and the market moving to the bottom how does this rule help you keep up?

I thought that I had already sufficiently explained this.

If you are valuating your BTC stash from the bottom price, then you are going to have had established a cushion in terms of how many BTC that you need, and in BTC historically, the bottom price has continued to move up more than 20% on an annualized basis, and if you are ONLY withdrawing 4%, then your BTC stash is likely going to continue to grow, especially because you continue to measure it in terms of the bottom price, so once you get started, you may well need to increase your withdrawal rate to 10% or even higher. Of course, if you continue to monitor BTC's bottom price and it continues to move up faster than your withdrawal rate, then you continue to have a cushion and your BTC holdings continues to grow.

Let's say for example you felt that you needed $3.3k per month to live off of your BTC (which would be a $1million stash size at 4% withdrawal rate), and if you look at the current BTC bottom price, you will see that it is currently right around $32,200, which means that you need 31.1 BTC to reach that level, but if you were employing a 10% withdrawal rate, then you would need ONLY right around 12.4 BTC to achieve that same results in terms of being able to withdraw at least $3,300 per month..

You can look at the sustainable withdrawal tool, and plug in your own numbers to see how your own numbers play out (or your aspirational numbers) and to play with the tool.. and it seems that part of the trick is getting your BTC stash to a high enough level that you start to feel comfortable with starting to withdraw and including that measuring from the bottom value will likely allow you to not over do it.. but you still have to have enough coins and to not overly withdrawal, especially if you are still nervous about whether you have enough when you start to withdraw and to live off of them as compared to when you might have had been still in your BTC portfolio building stages.

Quote from: Stablexcoin on March 17, 2024, 11:27:06 PM

because you will be worried about decreasing purchasing power. And so something to keep in mind.

The dollar has been decreasing its purchasing power, but not bitcoin, especially if you are using the 200-WMA as your way to valuate your BTC stash... so yeah, maybe you would not want to start to withdraw too soon if you are measuring that you need $3,300 per month in dollars, but that you expect that you might need $6,600 in the next few years, so then you might want to have a sufficient quantity of BTC as your extra cushion in order to account for the dollar value not going as far as it had gone previously..

Quote from: Stablexcoin on March 17, 2024, 11:27:06 PM

A typical model is unable to show the significant additional sequence of returns risk that can be introduced by those problems that arise during a down market.

That is why you measure from the bottom rather than the top, and also the tool reduces the withdrawal authorization amount if the BTC price is less than 25% above the 200-WMA.. yet even with a back testing of the tool, really aggressive withdrawal rates that go even greater than the 6% to 10% rate that I suggest to be sustainable would still have had been sustainable, even given the up and down years... that is one of the amazing things about bitcoin so far in its history.. even though its spot price has been pretty volatile, but if you had been measuring from 200-WMA, then you would have had been able to have an adequate cushion.

Quote from: Stablexcoin on March 17, 2024, 11:27:06 PM

I would prefer a 2% risk every year of my total investment. To me, this is safer than going higher for 4%. I am single and have no children so am ok with that.

If you are still building your BTC stash, then you might not even be ready to start withdrawing.. so it may well be way better to keep building until you have enough, and BTC allows much greater withdrawal rates than traditional 4 % patterns which are still pretty whimpy as compared with bitcoin's ongoing powerful performance.

And yeah, no matter what you do, you have to feel comfortable with your withdrawal rate and to make sure that you account for all your expenses, otherwise you are jumping ahead of yourself if you have only accumulated a few BTC but you are expecting a $3.3k monthly income that keeps up with inflation.. .. but if you have 12.4 BTC or more, you are likely in good shape to be withdrawing that quantity and even withdrawing at 6% to 10% per year.

Quote from: Troytech on March 17, 2024, 11:52:43 PM

Quote from: JayJuanGee on March 17, 2024, 03:45:56 PM

Quote from: Troytech on March 17, 2024, 05:51:40 AM

Quote from: JayJuanGee on March 17, 2024, 02:50:41 AM

[edited out]..Now if you are mixing your actions by buying and selling (in other words trading) then that is another story, but if you are strictly buying, then you have a dynamic that either your holdings are continuously going into less and less profits (in a bear market) or you have the dynamics that your holdings are increasingly in profits (in a bull market).

I highlighted a paragraph out, I've not been mixing strategies, I've been buying but I always thought we have been in the bear Market and I have also expressed myself in terms if us beign in the bear market but right now I feel my perspective of what a bear market or bull market is shattered, so I think it would be fair if I could explain more about it.

I already explained and probably overly explained, and so you need to think in longer timelines. In essence, we have been in a bull market since November 2022, and I give little shits about what others say about the various corrections along the way. The market does not change back and forth.

on the other hand, we could fairly assess that we might not have had realized that we were in a bull market until either mid-2023 or even as late as October 2023, but surely at some point, we would have or should have realized that we were in a bull market rather than a bear market since November 2022.

Bull market is that the price is generally trending up (even if there may well be short or long periods of corrections in between).

In other words, you cannot be flipping back and forth, and clearly even if we were in a correction in December 2023.. who gives any shits.. we were still obviously already in a bull market, even if there was a correction.

This is what I have understood from your explanation, if the price of bitcoin is going up or generally gaining value even if they seem to be corrections and what seem to be temporal dips when the price drops for a certain period of time and begins to add back again, and if we are looking it from a longer time frame and we notice that the movement of the market is upwards then it us a bull market, and also the same for a bear market when the price is generally moving downwards.

I think why I have always misunderstood this concept was because I was looking at it from a shorter time frame and getting confused due to temporal price correction and I was also thinking or assumed that when ever a dip occurs it was a bear market. I never knew that the market doesn't switch from bull to bear from time to time but rather stays on one trend for a longer time frame.

But I remember that it's good to have senerios or possibilities in short time frame and also longer time frames, where i could plan a set of different possible outcomes that could happen and prepare ahead which I've always been doing for a while now, but before now my focus has been on short time Frames without making preparation for a longer time frame.

Quote from: JayJuanGee on March 17, 2024, 03:45:56 PM

Of course, any of us still wants to try to minimize his cost per BTC, but there is ONLY so much that we are able to do about those kinds of things, especially if we are new to bitcoin and still building our stash...

I just don't want to bother much about my average cost now even tho I'm quite afraid that I might be buying at the highest price points and its possible for the bear to set in any time soon, but I know neither of these is my business cause I'm still quite early in bitcoin and I know that maybe over the years it's possible I could balance out my average cost or maybe bring it down a little bit lower as long as I'm consistent in my buying.

You are the one who was falsely proclaiming that we were in a bear market during your accumulation of bitcoin, which surely is not true.. .so maybe it is just best that you stop looking at the price at all.. and don't over invest.. just buy regularly some amount that you can tolerate if you may lose or not, and then after you have been through more than a whole cycle, then reassess the situation at that time.

In other words, you seem to be spending a lot of time worrying which way the BTC price might go, but why should that matter? Maybe you have a system and you have $400 per month that you could invest (which is $100 per week), so you invest 1/3 or that right away no matter what, and maybe the other 2/3 is used for making sure your finances are in order.. and then as you continue to study bitcoin then maybe you can change your amounts later on.. or if you are comfortable with 1/3 going to DCA right away, 1/3 building your emergency fund, and the other 1/3 to wait to buy on dips, if dips happen, and if they don't you just let that amount build up (which might be called your reserves).

In the end, you have to be comfortable with what you are doing, and if you are not comfortable, then maybe you are investing too much. It could be that you are investing beyond your level of knowledge and/or your level of comfort... so you just have to take it slower.. until you might be comfortable to become more aggressive.

I frequently have asserted that we should all try to be as aggressive as we can be without overdoing it, and if you don't know some of the basic price dynamics in bitcoin, then you might need to make sure that you are not being more aggressive than the level of your knowledge and/or your comfort.