Quote from: Obim34 on August 14, 2024, 09:17:00 PM

Quote from: Dailyscript on August 14, 2024, 08:40:21 PM

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On how we might preach the whole process to be, investing by lump summing isn't suitable for a beginner, how should he know at what price is comfortable to purchase, even a well knowledged investor might slightly enter from a wrong position which may hinder the progress of his profits. A well knowledge investor will understand that lump summing works perfectly during DIP because it will definitely pay huge when the price of Bitcoin begins to kickoff but then how long should he wait on the DIP, more reason why the DCA strategy becomes the most suitable and relevant way of accumulating, the DCA creates those perfect opportunities with ease and likely when the financial strength is ready.

Your ideas about lump summing are strange, and they likely have very little to do with whether you are a beginner or an experienced investor, even though the quantity of bitcoin that you already have could factor into how you treat a lump sum amount that you might have available.

So first of all with lump summing, you are dealing with an amount of money that you already have available for investing into bitcoin, which could happen when you first get into bitcoin, or you could have money come into your budget at any time while you are already investing into bitcoin.

When you get a lump sum that comes available, then if you have determined that you are going to use some or all of it for bitcoin investing, you have the option to plug it into one of the three categories, which is DCA, buying right away or buying on dips... It is not an all or nothing proposition, and you have quite a bit of flexibility regarding how to consider your use of such money.

Many folks get into bitcoin nearly completely through DCA because they might not have very many lump sum opportunities, yet whenever they do get lump sum amounts, there is a decent amount of liberating power to be able to decide how to use such lump sum, within the three categories for the amount that is decided to put into bitcoin, and surely the amount can also be used for building finances in other ways too, in the event does not end up getting allocated to consumption rather than investment.

Quote from: SmartCharpa on August 14, 2024, 10:52:11 PM

Quote from: Jewan420 on August 14, 2024, 05:36:46 PM

I totally disagree with you. An investor should not look at the Bitcoin price at all, when you invest in the DCA strategy, why do you need to look at the price? DCA strategy requires you to buy when the price is up and buy when the price is down.

You are correct, a professional investor does not need to check the Bitcoin price before investing because they already know the price pump and dump, however, I believe that only those who are new to the market should consider the price of Bitcoin before investing, because they had to start with a low price and gradually raise, some newbies to the market may choose to begin with a low price because they believe the Bitcoin price is too expensive for them to start when it is high.

By definition a beginner does not have any bitcoin, so by definition, a beginner is not prepared for up if the BTC price goes up. Therefore, a beginner has to buy bitcoin right away in order to prepare for up. There seems to be little practicality for a beginner to say that he wants to get into bitcoin, and does not get in since he is only preparing for down, and the BTC price may or may not end up going down.

How much BTC a beginner buys in the beginning is another question - which likely relates to the totality of his 9 factors that he would be advantaged in taking into account.

Quote from: Wind_FURY on Today at 04:29:00 AM

Quote from: JayJuanGee on August 14, 2024, 05:47:20 PM

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?
But why? I was merely making a point that a lower average entry price for the same amount of capital used will be holding more units in Bitcoin compared to the person who bought Bitcoin later, and therefore would make a better Return On Investment.

OK, to make a more practical example, the total cost is $60,000 for Investor A who bought Bitcoin with an average price of $2,000 vs. Investor B who bought Bitcoin with the same amount of capital but with an average price of $1,700.

That 5.2941 units in Bitcoin would definitely make a very big difference if Bitcoin surges over six digits, no?

You are creating some other examples, so maybe you should flush out how your investor A and your investor B reach their respective average cost per BTC, including that you are making a different point from me.

In my example, I was showing two different kinds of investors. The first one invested a small amount in the beginning of his investment between 2014 and 2016, and when the BTC price went up the first one choose to discontinue investing in bitcoin because he had a goal to keep his average cost per BTC down.

The second one continued to invest in bitcoin and overall had a higher cost per BTC and also way more invested into bitcoin over the years, including investing 2014-2016 but continuing to invest throughout the years. Sure I could have even included that the second one did the exact same thing as the first one, but he continued to invest after 2016, even though the BTC price was higher and that is why he ended up with 30 BTC rather than 5 BTC (and his first 5 BTC cost him $6k-ish but the next 25 BTC cost him $54k - since his total amount invested ended up being $60k), yet even with my own example, the numbers work better if my second guy had accumulated more than guy one in the first 3 years.. so guy 1 was more persistent throughout his investment into BTC as compared with guy one.. but my guy 2 had more of a limited budget in the first three years as compared to guy 1.. so guy 1 spent more in the first 3 years as compared with guy 2 who had an improving budget so he was DCAing throughout the whole period starting from 2014 to present.

You cannot even appreciate that you are changing the hypothetical and trying to suggest that all things being equal, then it is better to have a lower cost per BTC rather than a higher cost, and that is a different point than what I was making and also a different hypothetical

Of course, if all things are equal it is better to have a lower cost per BTC, yet in my situation, all things were not equal, and one of things that happened to be different, is that the first guy (in my hypothetical, which I understand to be extreme but it is not unrealistic) was obsessed with making sure he kept his cost per BTC down, and so in accordance with his own belief, he refused to buy more BTC with the passage of time since the BTC price was going up because that would have increased his average cost per BTC beyond $600 per BTC and he wanted to keep his average cost per BTC down, and in my example, the second person did not have such restriction on his own approach and he continued to accumulate BTC (and he even could continue to this day) even though his average cost per BTC is much higher than the first and through his investment his average cost per BTC (and the BTC price) is continuing to go up as long as he continues to accumulate BTC.. even though the second guy is already with 30 BTC so he might be starting to feel that he has enough BTC - which also is a personal choice to consider how much is enough.. and he cannot go back in time and buy more at certain price points.. he feels that he did the best he could in regards to his own BTC accumulation under his own cashflow circumstances.

But you want to assert that there could have potentially been a way that guy two could have gotten his BTC cheaper and that he would have had been able to get more if he had been more strategic with his BTC purchases rather than what he ended up doing, which was buying BTC every week within his budget? I have continued to suggest that it is can be quite difficult to know where the BTC price is going, so yeah, afterwards you can look back at the BTC price and determine when you would have bought and when not, yet it is still difficult to apply that across the board.

Sure there might be some weeks where any guy could choose to invest less that week and to hold back some of his money because he thinks that BTC prices might be lower the following week, so if he successfully buys more BTC on dips than his regular DCA buys, then he might end up with lower costs per BTC and also with more BTC on the same budget, but the mere fact that he might be able to buy more BTC cheaper does not justify that he should stop his weekly DCA, and so those end up being variable determinations that any guy can make based on his own circumstances which also includes having more liberty to hold back buying as many BTC when he has already spent a considerable amount of time and money already accumulating what he considers to be a decently sized BTC stash.