As beginners, I don’t think they need to look for other strategies besides doing DCA (dollar-cost averaging) unless they have a large amount of money they want to invest. However, even if they have a significant amount of money, I would advise them to start with a small amount and apply the DCA method.
I disagree with this sentence. Why would a novice investor exclude investment strategies from his list of research along with investment continuity? Are you trying to limit him to DCA strategy? Or are you trying to limit his knowledge? A novice should start investing with DCA and this strategy is the best strategy for him. But how would he compare how reasonable it was to advise him about DCA strategy? Or how would he choose the best strategy for him? Are you advising a novice investor to stick to someone else's advice?
You seem to be exaggerating Shadiq and wanting to make an argument out of a valid point. There is nothing wrong with beginners starting out with DCA while they are getting their feet wet. Surely, if the beginner does not have any lump sum amount available, like SOKO-DEKE seemed to have had suggested, then there may well be no reason to consider any other method than DCA, at least to get started. Of course, the longer that a person is investing into bitcoin, then perhaps the more chances that they are going to have to consider their other buying options, such as lump sum and/or buying on dip. Hopefully, you are not suggesting that selling is a good BTC accumulation strategy or getting involved in shitcoins, yet surely if a newbie might be asking about trading and/or shitcoins, then there might be some needs to attempt to redirect them, including, potentially to get them to either completely not trade or to completely not get into shitcoins, and surely some folks might want to get into shitcoins, trading/gambling, and maybe the next possibility would be to try to get them to limit their fucking around with trading/gambling and/or shitcoins to less than 10% of the size of their bitcoin holdings.
Whether an investor has money or not, I would not discourage anyone from researching investment strategies, rather I would encourage them to learn them. Because if you are not aware of the strategies, how can you be a skilled investor?
The various strategies to invest into bitcoin by buying are not that complicated, especially since there are largely three kinds, yet it seems that one of the best things for any beginner to do is to start by buying some bitcoin, and probably by starting to DCA into bitcoin on a weekly-ish basis while they are learning.. and whether they need to learn other buying strategies might not be as high of a priority as their figuring out how they might plan to go about their cashflow management practices.
Or how can you make someone else differentiate between DCA and other investment strategies? I don't see anything wrong with exploring investment strategies to gain knowledge, but it's better for a beginner to not invest in a different strategy if they aren't already skilled at investing.
Since you seem to feel so strongly about these matters Shadiq, then maybe you should describe what you are wanting to teach in terms of the beginning matters? And how much time are you planning to be able to spend with any particular newbie? Is the newbie inclined to listen to you? Does the newbie have other ideas? Does the newbie even want to invest into bitcoin? What is their reason for investing? Perhaps they have to consider their
9 individual factors if you were wanting to get into details with them?
Try to start buying bitcoin in installments now, if the price goes down, you make it an opportunity to buy bitcoin again, you will get a cheap price, right? Or when you want to sell it, you can sell it little by little first/sell it gradually. Then when the correction occurs you buy again. This is a good strategy, especially if the goal is long-term, it will be more profitable.
I am not understanding how you consider selling and/or trading of bitcoin to be a good strategy for long term investors into bitcoin or how you would consider that trading (or selling) would potentially make your bitcoin holdings more profitable as compared with strategies that do not include selling.
You seem to be presuming that newbies (or perhaps more experienced investors) are going to have some abilities to figure out good times to sell their bitcoin in such a way that they are going to be able to buy back cheaper (and without suffering from risks of selling too much too soon or without running the risk of putting themselves into a waiting (rather than a ongoing buying mentality) and then ending up with fewer bitcoin than what they could have had if they had not fucked around with selling).
Just consider yourself, your budget and what you have been doing for the last 8.5 years that you have been registered on the forum. If you had been buying
$100 per week of bitcoin since the time of your forum registration date, you would have had invested around $44k, and you would have had accumulated about 6.54 BTC. Hopefully whatever you have been doing with your selling of bitcoin and/or trading of bitcoin at various points along the way has gotten you results at least as good as a straight-forward DCA strategy.
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I believe you because I have seen it and I am the proof of it myself because I am not very rich I started putting some money in Bitcoin from a very small salary. I once asked how to invest in Bitcoin and because I did not have much money I refrained from investing in Bitcoin I always thought that I would never be able to invest in Bitcoin but from here I got encouragement from people and after learning from everyone I am now constantly investing in Bitcoin with a very small amount of money. I now have about $50 in my investment portfolio I am not nervous at all because I will invest my Bitcoin in this way and keep it for a long time.
I am not getting nervous anymore because I see many countries accepting Bitcoin as legal tender and accepting Bitcoin as a strategic reserve so after seeing all these news and reports, why should I not think about investing in Bitcoin? Moreover, I am seeing Michael Saylor's Bitcoin investment. He is continuously investing in Bitcoin and planning to hold it for the long term and predicting a beautiful position for the price of Bitcoin. So I don't have to worry so much about Bitcoin. So Bitcoin investment is a very good investment and if you hold it for the long term, you will definitely get a lot of success.
First off. Your supposed investment into bitcoin of $50 is so small as to hardly mean anything, especially if you are proclaiming that it took you some time to build your bitcoin investment up to that amount.
Second, it is difficult to take such a small investment amount seriously, and if your story is true, then perhaps you have to figure out some kind of way so that you can increase your income and/or decrease your expenses in order that maybe you can try to get up to something like $10 per week invested into bitcoin, and even $10 per week is a small amount.
Sure, I am not trying to poo-poo that some guys do not have very much discretionary income, yet it seems almost to be a waste of time to be talking about such small amounts of investment as if they were very significant, even though truly folks who have really tight finances might consider such small amounts to be significant, even though many of us might also consider that there is some need to try to increase the investment amount to the extent possible.
It seems that a lot of people have variation in their income too, and there may be periods in which they come across extra money that they can invest into bitcoin, or maybe they have periods in which their cashflow is tight and they are not able to put very much value into bitcoin. Being consistent may well be putting a priority on investing into bitcoin, yet the weekly amount does not necessarily need to be the same.
One of the reasons that we might describe a certain average cost per BTC historically (to back test) or to project into the future is in order to attempt to ball-parkedly describe some kind of a scenario in easy to digest terms, since of course if we describe how much a person actually ends up putting into bitcoin we might have a lot of variance from week to week, and maybe some weeks only have $10 invested into bitcoin and other weeks have $600 or more.. ..but there still might a bit of a preference to invest large portions of the discretionary income into bitcoin during the earliest of BTC accumulation phases, yet as the BTC accumulation might stack up, a person might decide to become a bit less aggressive. There surely is discretion in regards to how to treat their BTC accumulation, and guys might even end up making mistakes in terms of their choosing their own level of aggressiveness.
That’s a very notable point you just raised there. People’s incomes can indeed change and be like all over the place, making it always impossible or pretty difficult to predict just how much exactly that one will be able to invest in Bitcoin from a week to the next one. Just as you’ve rightly said, one may have a bunch of cash in their discretionary reserves to throw into Bitcoin for that week, and some weeks you barely have enough in your discretionary reserves and can only afford to throw in just a little amount of cash.
And I totally agree that in all this, it takes only consistence to be able to navigate through these situations, even when it involves being more aggressive some weeks and being less aggressive in others. It’s a lot more about prioritizing your Bitcoin accumulation and also being intentional about how exactly you’re allocating your finances.
I think the idea you also brought up of average cost per BTC is also pretty much commendable, because it’s a pretty great way of simplifying things and making them a lot more easier for you to track and take note of. Anyone who is actively involved in the market would understand that it’s not always possible or easy to outcome of the market, especially within the short term, but when we look at averages, we may be able to get a hang or a sense of what to expect.
Another essential thing to also consider is the fact that people’s priorities and financial goals may also change overtime. Some people start off their accumulation in a pretty aggressive manner because their priority was to build up their Bitcoin stash and portfolio as quickly as possible and as they get closer and closer to their goal, they may feel like they wanna relax a bit and start to feel a lil more comfortable and then eventually change their mindset and decide to scale back their investment, which definitely reduce their aggressiveness.
Another thing that likely happens after we have been investing into bitcoin for several years, perhaps even after building up our bitcoin holdings up to several years worth of our expenses (perhaps through appreciation rather than merely through contributions), after a while there can develop senses of futility to keep adding value to the bitcoin holdings, since they likely change in value way more based on fluctuations in the bTC price rather than based on new contributions. So, there can develop senses of futility to continue to add value to the bitcoin holdings. And, sure, some guys might prematurely reach such feelings, and they likely would be better off to continue to contribute towards building their bitcoin holdings, yet they get the sense that they have reached enough bitcoin or more than enough bitcoin based on their own earnings and their abilities to contribute more towards their bitcoin holdings rather than having had reached a stage that they are likely to start to begin to sustainably withdraw from their holdings.
Accordingly, there could be several years of merely just holding bitcoin rather than continuing to contribute between the time that the guy initially bought his bitcoin and when he starts to feel that the value of his holdings is large enough that he can start to sustainably withdraw from his holdings, whether price-based withdrawals and/or time-based withdrawals.
And of course, we can’t completely ignore the element of discretion which is totally unavoidable when we are choosing to decide how to manage our bitcoin investments. It’s really not easy to know for sure whether the next move we plan to make is actually the best or even the right, leaving room for mistakes and errors. But I believe that’s an inevitable aspect of the learning process and also about being pretty much international and putting in one’s best in what they’re doing with the resources that’s available.
Sure, a person may go through changes in his income/expenses, and he may have (or may not have) had built up other investments that he might consider their role in terms of keeping them or perhaps making some reallocations, and his ideas about how much money he needs might change too, yet if he had been prioritizing his investment in bitcoin, he likely has suffered less negative consequences from the various debasements of the dollar (and the rise of the various costs of living goods/services) as compared to folks who had kept large portions of their value in non-bitcoin investments.
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It seems that as we are learning about bitcoin, and as we might even be building our bitcoin accumulation systems, there may be a variety of ways that we are measuring our progress, and surely the more that we get into setting up systems to attempt to increase the aggressiveness of our BTC accumulation systems, we likely need to pay more attention, and their may well be some fun in terms of plotting out various scenarios in regards to where we expect to be, and then perhaps later to show the extent to which our projections ended up being correct.. whether we are looking 3-6 months down the road, 1 year, 3 years or some other longer timeline. Some new variables in our calculation of our goals might come into play, and sometimes some of our variables might disappear to cause changes in our assumptions about the realistic nature in regards to having certain kinds of sub-goals.
Yeah, as we proceed and grow in our Bitcoin journey, it’s absolutely normal to develop various techniques and ways to measure our progress as well as it’s normal to develop one’s personal strategy. And the more we advance, develop and become more sophisticated in our Bitcoin, there’ll certainly be need to pay attention to the details.
I also love how you mentioned plotting out scenarios and projections. Being able to track one’s progress can be quite fun for sure because it also makes you have a visual of how close you are to your goals and projections. Whether it’s the short term goals, which is around 3-4 months or even 1 year, or you’re focused on the long term, which we can say to be around 4, 5 to 10 years or/above, you’ll be able to stay more focused and motivated when you’ve got a clear plan already in place.
I have been making projections into the future for more than 25 years, and surely my projections have gotten better, and I have also gotten better at playing around and manipulating Excel, too. Sometimes it can be interesting to go back and look at some of my older projections and to see how my older projections had played out in comparison to the reality of what actually ended up happening.
I thought that I was doing pretty good prior to bitcoin, yet after I started incorporating bitcoin into my projections, it is quite amazing that more bullish scenarios ended up playing out way more closely as compared to what I had considered to be more likely scenarios. I think that one of the matters that saved me from cashing out too many bitcoin too soon is because I had already created modest plans to sell BTC on the way up, so that even when the bitcoin went shooting up I did not end up panicking. I am not sure if or how badly I might have screwed things up if some variation of my plan had not been outlined in advance. I did not completely stick with the plan, and surely I also had some regrets during the 2018 correction, yet my reaction was to tweak rather than to completely revise. Surely there can be guys that proclaim that their plan worked better, yet many times I have been quite happy with how my plan has played out. .and surely historically bitcoin has also been able to help several of us to recover from a lot of our mistakes as long as we had been largely erroring on the side of accumulating and/or HODLing..