JJG’s Outline of Bitcoin Investment Ideas

[abaeze]

You still did not do a very good job of fleshing it out, which also gets me to speculate that you are so much caught up in a mindset that whines about the advantages of the rich guy versus the poor guy rather than really attempting to grapple with the trade offs that present themselves based on differing choices of aggressiveness that any one person might have based on his own income and then his choices within how he ends up using his income.

I got your point, The key is how much risk each person is taking relative to their income and how flexible their investment is relative to that risk, and that is the standard that everyone should make their trade offs on. Aggressiveness depends on what percentage of a person's discretionary income is invested, not on the amount of total assets. In that case, a person using 62.5% of discretionary income will be able to make decisions more flexibly with less risk than a person using 100% discretionary income.
So, long term low-risk accumulation is a better trade off for the person using 62.5% discretionary income than trying to accumulate more in less time with more risk.
Eventually, there are trade offs in every investment decision, but whether the trade off is made wisely is what makes the difference between a successful and a failure investor, isn't it?

Investment is not short-term, investment is not something where you invest your entire discretionary income for a few days and then sell it after a few days. Investment is a long-term discipline, where you have to be patient and keep yourself as risk-free as possible.

How much you invest will depend on your discretionary income, not your main income. Even if you earn $1M per month, it is not important, what is important is how much money you have left (discretionary money) every month after all expenses.

From this discretionary money, you have to prepare the necessary funds. First, the investment fund, then the necessary backup funds. We can increase and decrease the amount of the investment fund as needed. If preparing a backup fund becomes important, then the amount of the investment fund may decrease, if the investment becomes important, then it will increase. However, you have to be careful that you are not making the investment fund risky.

The things you mentioned long term investment, patience, backup fund are correct but you didn't get my main point. My point was that investment aggressiveness is measured as a percentage of discretionary income and there is a risk difference between 62.5% vs 100%. But you have shifted the topic here. Not only that, I discussed the trade offs i.e. risk vs flexibility vs accumulation speed but you only gave general investment advice but didn't give a complete analysis of the trade offs discussion, which was the discussion that was basically happening with @JJ.
However, your investment concept is simple. You talked about slow investing, in the long term, and only with the money that is left after expenses. That means you explained Bitcoin accumulation through DCA in the long term and also need to keep an emergency fund so that the investment does not become risky. Although here the trade off is investing more vs keeping more backup fund i.e. if one increases, the other decreases.

[Joeboy]

How much you invest will depend on your discretionary income, not your main income. Even if you earn $1M per month, it is not important, what is important is how much money you have left (discretionary money) every month after all expenses..

Surely investment should only come from ones discretionary income, but that isn't enough reason to say that income isn't important, since income happens to be one of the source that folks can realize their discretionary income from... The truth will always be that the size and stability of your income still plays a key role in determining how much discretionary income and(or) backup funds/emergency funds can be realized to ensure the continuity of foks investment...

The things you mentioned long term investment, patience, backup fund are correct but you didn't get my main point. My point was that investment aggressiveness is measured as a percentage of discretionary income and there is a risk difference between 62.5% vs 100%. But you have shifted the topic here. Not only that, I discussed the trade offs i.e. risk vs flexibility vs accumulation speed but you only gave general investment advice but didn't give a complete analysis of the trade offs discussion, which was the discussion that was basically happening with @JJ.
However, your investment concept is simple. You talked about slow investing, in the long term, and only with the money that is left after expenses. That means you explained Bitcoin accumulation through DCA in the long term and also need to keep an emergency fund so that the investment does not become risky. Although here the trade off is investing more vs keeping more backup fund i.e. if one increases, the other decreases.

Investing and keeping some backup funds/emergency funds are both very important for ensuring the continuity of folks investment journey.. That why I think that there shouldn't be the need for a trade off, since folks could very well practice balance... By balance, I mean that folks could very well give equal importance/attention in growing your discretionary income( for investment) in such a way that it give you room to consistently invest and also maintain/ strengthen your backup funds/emergency funds...

[Baki202]

yes i think that people are free to invest with any amount of discretionary income they have at their disposal, as far as that amount is coming from individuals discretionary income then there shouldnt be too much of a problem. because in bitcoin investment sometimes even when people are dcaing little by little and probably a particular week or month an extra or additional money comes to them and they finished sorting out their basic expenses they can decide to buy a lump sum with that additional cash that comes in for them either as a result of bonus they receive from work, or they win money from lottery or other sources. so its legal to invest with a good amount of cash as far as it is your discretionary income.

People have a choice of investing whatever they want to invest from their discretionary income, and that makes everything balanced because it is a personal choice that is made nd you don't have to bother with what they do with their discretionary income. It is not as if they are spending it on themselves, but rather they are investing, which is one of the best ways that money can be used, you are securing the future.

And when they continue to take this idea seriously about their investment, because that is the only way they make things go forward for them, because from the look of things, when it comes to investment, people are always losing ideas, and this is why they need to have knowledge, and from there, options are made available.

From the beginning, I have been a preacher of investing because I have seen a lot of potential in this situation, and that is why I encourage people in the little way you can encourage people. I do it because it is always a good opportunity to invest in Bitcoin.

[ruykeri]

yes i think that people are free to invest with any amount of discretionary income they have at their disposal, as far as that amount is coming from individuals discretionary income then there shouldnt be too much of a problem. because in bitcoin investment sometimes even when people are dcaing little by little and probably a particular week or month an extra or additional money comes to them and they finished sorting out their basic expenses they can decide to buy a lump sum with that additional cash that comes in for them either as a result of bonus they receive from work, or they win money from lottery or other sources. so its legal to invest with a good amount of cash as far as it is your discretionary income.

I think a person has complete freedom in their investment, and it is ultimately their own decision which method they will use. Some people are comfortable with DCA only, some want to use lump sum occasionally, and some can even mix the two.

My personal opinion is that when extra cash comes in, I think it is more logical to increase the DCA amount a little than to do a lump sum all at once. Because the biggest strength of regular DCA is that it gives the investor a habit, a rhythm, a system. If someone buys regularly every month or week, then he will worry less about market timing, and keep his accumulation process steady. Now let's say a person is buying $50 every week. Suddenly he gets $400 extra. If he wants, he can buy BTC at once with that $400, but that may reduce the focus on his regular buying system and increase the excitement. On the other hand, if he keeps a part of that extra cash and increases his weekly buys from $50 to $100 in the next 8 weeks, then he has used the extra cash at the same time, and his regular disciplined accumulation process remains intact.

However, I am not rejecting lump sums completely. If someone really wants to give a part of the extra cash in lump sums, then first half of the lump sum for experimental purposes, and the remaining half as regular DCA. In this, the investor gets some benefit from both sides.

[Taskford]

yes i think that people are free to invest with any amount of discretionary income they have at their disposal, as far as that amount is coming from individuals discretionary income then there shouldnt be too much of a problem. because in bitcoin investment sometimes even when people are dcaing little by little and probably a particular week or month an extra or additional money comes to them and they finished sorting out their basic expenses they can decide to buy a lump sum with that additional cash that comes in for them either as a result of bonus they receive from work, or they win money from lottery or other sources. so its legal to invest with a good amount of cash as far as it is your discretionary income.

People have a choice of investing whatever they want to invest from their discretionary income, and that makes everything balanced because it is a personal choice that is made nd you don't have to bother with what they do with their discretionary income. It is not as if they are spending it on themselves, but rather they are investing, which is one of the best ways that money can be used, you are securing the future.

And when they continue to take this idea seriously about their investment, because that is the only way they make things go forward for them, because from the look of things, when it comes to investment, people are always losing ideas, and this is why they need to have knowledge, and from there, options are made available.

From the beginning, I have been a preacher of investing because I have seen a lot of potential in this situation, and that is why I encourage people in the little way you can encourage people. I do it because it is always a good opportunity to invest in Bitcoin.

Agree that investing is one of best use for our discretionary income and this is one of best choice we would made, since this can help us secure our future if we choose those good investment like Bitcoin.

Having good knowledge is important since without having it we might get mislead and lose some sense of direction. And this is why focusing only on Bitcoin then ignore those shitcoins really have sense at all. since Bitcoin is proven one of the best asset or investment to have, since other altcoins out there is short time money grab or risky to deal with. Everyone can even start with small amount here and over time until it can build them to continue then proceed with much bigger more amount to spend as long as this is aligned with their discretionary funds.

[JayJuanGee]

yes i think that people are free to invest with any amount of discretionary income they have at their disposal, as far as that amount is coming from individuals discretionary income then there shouldnt be too much of a problem. because in bitcoin investment sometimes even when people are dcaing little by little and probably a particular week or month an extra or additional money comes to them and they finished sorting out their basic expenses they can decide to buy a lump sum with that additional cash that comes in for them either as a result of bonus they receive from work, or they win money from lottery or other sources. so its legal to invest with a good amount of cash as far as it is your discretionary income.

I think a person has complete freedom in their investment, and it is ultimately their own decision which method they will use. Some people are comfortable with DCA only, some want to use lump sum occasionally, and some can even mix the two.

Of course, people can do whatever they want, yet you are still describing options in an incomplete and perhaps unrealistic kind of way.

Guys can buy bitcoin as soon a the money comes available or they can defer, and there may be many times that guys do not have options to buy with lump sum because they do not have lump sum available.  If they don't buy and they just let their cash build up, then I would not call that lump sum. I would call that deferral and a trade off with an attempt to buy the dip.

My personal opinion is that when extra cash comes in, I think it is more logical to increase the DCA amount a little than to do a lump sum all at once.

Sure.  There is nothing wrong with that approach - even though in that case, there would be time deferral and perhaps hesitancy to get larger forms of price exposure all at once... It may also depend on how much of an irregularity is taking place (how much extra funds have come in?).. If the weekly buys are tending to be $100, and the extra cash that comes in is around $1k, then that has the potential of being around the same size as 10 weekly buys... and surely having more money coming in is not a bad problem to have because the extra money coming in could trigger some incentive for a reassessment of what is being done and if any tweaks need to happen.

I frequently mention that the three options include buying the dip.. so whether money is set aside for buying the dip might depend, in part, on how much money had already been put in at the given price, so if an extra $1k came in right now, there could be considerations of buying the dip, yet there could be just a consideration to double the regular DCA for the next 10 week, and if a dip were to occur in the next 10 weeks, then there could still be some of that extra $1k that is still available depending on when the further dip were to happen, and of course, if it were to happen.. and if it were enough of a dip to trigger some desire to use any of that money to buy at that point.

There is no exact correct answer, even though there surely can be trade-offs for decisions to buy BTC right away versus deferral for some or all of money that is currently available.. .

Because the biggest strength of regular DCA is that it gives the investor a habit, a rhythm, a system. If someone buys regularly every month or week, then he will worry less about market timing, and keep his accumulation process steady. Now let's say a person is buying $50 every week. Suddenly he gets $400 extra. If he wants, he can buy BTC at once with that $400, but that may reduce the focus on his regular buying system and increase the excitement. On the other hand, if he keeps a part of that extra cash and increases his weekly buys from $50 to $100 in the next 8 weeks, then he has used the extra cash at the same time, and his regular disciplined accumulation process remains intact.

However, I am not rejecting lump sums completely. If someone really wants to give a part of the extra cash in lump sums, then first half of the lump sum for experimental purposes, and the remaining half as regular DCA. In this, the investor gets some benefit from both sides.

Ok.  Our examples ended up being similar, and surely, I think that you have pointed out ways in which there can be attempts to profit from both systems, and our main dilemma might be considering the ratios in terms of how much to allocate to each.. right away, versus deferral... another thing is that when we receive a lump sum, we might be inspired to reconsider how much money we currently have available in our back up funds, and even in your example, there could be an outcome in which the guy considers that he needs to put an additional $200 into his back up fund, and the receipt of the extra funds ended up providing him a great opportunity to take that action.