Post
Topic
Board Bitcoin Discussion
Merits 1 from 1 user
Re: DCA method
by
JayJuanGee
on 11/09/2024, 13:27:26 UTC
⭐ Merited by tottong (1)
DCA strategy is always has so far always been a long term profitable strategy. The DCA strategy is for middle-income people, that is, those who don't have a lot of money but are interested in investing in Bitcoin. If such a person had started investing in Bitcoin 5-10 years ago, he would still have made a lot of profit.

DCA is ONLY a profitable strategy if the asset ends up going up in price and at least is worth more than your average cost for it.

The historical fact that bitcoin has been going up does not guarantee it to continue to go up.

Sure bitcoin is amongst the best of investments available on a wide-spread basis, if not the best investment - yet it is still NOT guaranteed to be long-term profitable whether employing DCA or employing some other strategy.

As an example I am showing a DCA chart for the last 5 years:

Here you can see that if a person had invested $50 on a monthly basis using DCA 5 years ago today, his total investment portfolio would have been $3000 today, and holding these 5 years his profit portfolio would have been worth $6926, which is his investment, 230% more than that, and his total savings would have been $9926. Also it's current price is $56,185, so imagine if you continue investing like this, and when Bitcoin crosses 100K, then how much be your profit? This will benefit you considerably. So always think of DCA, it is the best way to invest. This will benefit everyone in the long term holding.

There is nothing really wrong with the example (here's the link to that particular example).

I would suggest when using that site sometimes it may be better to calculate the numbers based on how much BTC would have had been accumulated an then multiply that number by today's price.  So 0.1489 BTC multiplied by your price of $56,185 would be $8,366.  and so no problem.. still profitable.. .. also we could calculate average cost per BTC as right around $20,148 (which in your example would be $3,000 divided by 0.1489 BTC).  I personally prefer the idea of newbies to invest into BTC weekly rather than monthly, but yeah it is understandable that sometimes it might be difficult to carry out weekly investing based on cashflow uncertainties.