DCA (dollar cost averaging) as a means of strategically acquiring AGRS (Tauchain Agoras)

in #tauchain6 years ago

Dollar Cost Averaging Explained

Dollar cost averaging means to buy a fixed dollar amount of an asset at a scheduled time frequency. So this could mean if you buy crypto once a month then you buy $20 worth of AGRS a month. The benefit of dollar cost averaging is you do not have to care about the price of the asset. If the price goes down then you get a bit more of the asset and if it goes up then you get a bit less. Dollar cost averaging works best for long term investments rather than for day trading. It works best for strategically acquiring specific assets over time at a predictable rate.

If a person has a limited budget then DCA makes sense. Particularly right now when crypto is very cheap. Some people believe that crypto will eventually go back into a bull run. If the way to win the game is to buy low and sell high then DCA may or may not result in that in the short term but in the long term if someone were to simply DCA for the past few years then they would be up and still be acquiring more crypto.

This is not investment advice nor do I make any specific recommendation. This is just something I will likely be doing myself going forward. Crypto at this point is easier to earn than to sell. That is to earn it produces a feeling of winning while to sell it at these prices produces a feeling of being ripped off. So the only amount I will sell is the minimum amount required. At the same time it is still possible to earn crypto and as long as this is true then there may be opportunities to sell one crypto to buy another crypto.

In that case AGRS has great long term potential in my opinion. Other interesting projects include Enigma (ENG) and any under valued cryptos. If a crypto for example is going for really cheap such as Ardor or a new token is launching then it may also be an opportunity. If or when there is another bull run in the crypto markets then many obscure tokens could rise in price.

Anyone who is in crypto for the long term understands that it's about acquiring a larger and more diverse crypto portfolio over time. The dollar value of that portfolio is not under our control but the size and diversity of it is. If we believe that crypto will eventually include securities and productive assets then having built up a portfolio via dollar cost averaging can be a successful strategy. $50 a month into crypto for 3 years is 1800 but we know from experience that $100 in Ethereum in Aug 2015 (only 3 years ago) would be worth $6000+ today.

References

  1. https://www.investopedia.com/terms/d/dollarcostaveraging.asp
  2. https://99bitcoins.com/if-i-invested-in-bitcoin/
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I like the concept of making scheduled purchases. I've been trying to make more myself, and get into a more scheduled system so I can continue to diversify my portfolio rather than try to use what I have to day trade. Just today I tried to transfer some steem into binance to make a new investment but my dumb ass forget to put the memo because I was so excited. Got pretty bummed about it but oh well! Nothing I can do now. Scrolling through and seeing your post encouraged me a little to stop kicking myself about my mistake and just work towards the next one instead. Thank you Dana :)

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