Learn the best strategy about when to buy Bitcoin
We all know that the price of Bitcoin, like all assets and stocks, is volatile, it does not have a fixed price, constantly moves, sometimes rises, and sometimes falls. For that reason, we all would like to have a crystal ball to know when is the best time to buy Bitcoin and thus get the best possible return in the shortest possible time. In this article, we will show you what is the best strategy to buy bitcoin and other cryptocurrencies.
The best strategy to buy Bitcoin that exists is known as DCA, using it you can buy Bitcoin at the lowest possible risk and earn the best return.
What is the DCA strategy?
Dollar-cost averaging is an investment term for regularly buying small amounts over time. By separating purchases, you can minimize the impact of market changes.
Dollar-Cost Averaging (DCA) is an investment strategy that consists of entering the equity or fixed income markets periodically, that is, little by little, and always with the same amounts of money, regardless of how to move the markets. Doing it this way has two main advantages.
- The First one is to make sure you buy at the best times, that is when the price drops. Yes, you read correctly, when Bitcoin falls in price. Although it will also be done in the worst moments when the price rises. But the influence of buying at the best times (when it falls) on the final profitability is greater than that of buying at the worst moments (when it rises).
- The second one is to abstract completely from what happens in the markets. Dollar-Cost Averaging helps in emotional management when investing since it is done from the tranquility of following the set plan.
So this strategy (DCA) and aims to reduce the impact of volatility when making a large investment. Overall, dollar-cost averaging takes the emotional component out of buying bitcoin and provides some security against sharp price movements by helping traders avoid investing a large sum at a potentially inopportune time.
Let see a couple of examples.
In that example, it shows us calculations of our earnings if we had invested $ 500, $ 1,000 or $ 2,000 monthly or 125, 250, and 500 weekly. It is clear that regardless of the amount of the periodic investment, you could earn at least 71% of your investment in just 12 months. (If only the data for this year 2020 is taken)
DCA is the formation of a recurring investment strategy and if we join it to an economic recession, it is the best time to buy assets, since they are available to buy at a lower value than normal, the bear market would be the best time to start. to invest. In other words, we are currently living in difficult times for the world with the COVID19 pandemic, but for an investor, it is the best time to start investing. (We buy below and sell above).
What would have happened if we have applied the DCA strategy for 10 years in Bitcoin?
In this calculator, we can see what would have happened if we had applied that strategy since 2010 with Bitcoin. You will be surprised by the benefits...
As we can see in the image, if we had started to apply this strategy to buy bitcoin with a weekly investment of 150 since July 2010, we would have invested a total of 77 thousand dollars, but at today's price, we would have obtained a profit of 420 million dollars, that is to say, earnings of 544,055% of what was invested. No bank or investment fund would have guaranteed us profits of this type in 10 years, with only 150 dollars a week. So we see how effective this strategy can be with Bitcoin over time.
Conclusion
We must establish a purchase plan little by little but constantly over time. DCA is a safe, simple, and great performing strategy that works very well with the purchase of Bitcoin and other cryptocurrencies. If you want to invest money in Bitcoin without spending hours and hours in front of a chart or invoking gods to know when exactly to buy, this is your investment strategy. If you want to make money with an assumable investment on a weekly or monthly basis, DCA is your option. Buy Bitcoin or other cryptocurrencies buying small amounts but regularly and constantly.
Instead of purchasing $10,000 a year, for example, it is better to make weekly or biweekly purchases of $100- $400. In this way, you can earn with the price differences and avoid making a big purchase at inopportune moments. At HeyBitcoin you can buy large amounts of Bitcoin and other cryptocurrencies daily, remember that with us you can buy up to 50 thousand dollars a day.
Now you know what is the best strategy to buy bitcoin. Will you waste more time? Start today your purchase plan following this strategy!