Have a clear understanding of what DCA means

[darkangel11]

Imagine the current price of BTC is $20,000, and you're a high-earning individual looking to invest in this asset. If you make a lump sum investment, you would acquire one BTC at a cost of $20,000.

However, with DCA, you spread that $20,000 across five equal $4,000 purchases, resulting in costs of $20,000/BTC, $15,000/BTC, $5,000/BTC, $5,000/BTC, and $25,000/BTC. This approach yields an average cost basis of $18,000, and you'd have 2.3 Bitcoin. When Bitcoin's price eventually rises, your gains can be amplified because you lowered the average cost of acquiring your holdings. With DCA, you steadily accumulate more Bitcoin, even during market ups and downs.

To illustrate, your first purchase acquires 20% of 1 BTC at $20,000. The second purchase, at $15,000, gets you 26.66% of 1 BTC. Your third and fourth purchases, both at $5,000, result in a total of 80% of 1 BTC with each buy. Your final purchase, at $25,000, represents about 16% of 1 BTC. In total, you've accumulated around 2.3 BTC.

Plot twist:
After your first purchase bitcoin goes from 20 to 25k and your friend who bought a lump sum has 25% profit (5k), while you have 20% of that.

I'd call DCA is a good strategy when you have constant inflow of money, but no savings, or you don't want to touch those savings for whatever reason.
So, you earn 1k a month and want to spend $100 every time you get your paycheck on buying bitcoin. That's great!
If you have 20k in the bank just sitting there and earn 1k on top of it every month, don't DCA, just allocate 10% of your savings or whatever you feel comfortable with.

[pawel7777]

The thing is pretty simple, once you cut the "average" word out of it, it stops being dollar cost average, just as ice cream without ice is no longer ice cream is at best just cream!
So if you buy based on guts and instincts random sums at random intervals it's either RDC or GRT or PNGYSHYT but for sure not DCA.

The whole point of this strategy is to keep risks of high volatility at a minimum and to spread the investment sums, If you do it randomly why would you even call it DCA and lie to yourself you doing some strategy?

But there's no cutting out the "average" at all. You will still have an average price even if the purchase amounts or timing are not 100% consistent.
I don't think the sky will fall if one month you buy for $99 instead of $100 or buy on the 2nd instead of on the 1st of the month. I see it more of a spectrum than a binary thing.
Every strategy can be tweaked or modified. It's not like you either have 100% adherence or complete randomness.

[stompix]

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I don't think the sky will fall if one month you buy for $99 instead of $100 or buy on the 2nd instead of on the 1st of the month. I see it more of a spectrum than a binary thing.

We're not talking here about buying $99 instead of $100 or the next day because your internet was off.
Let's start again from my first post in this to which you replied:

You even don't have to use a same amount of capital for each DCA round. Sometimes you can use smaller or bigger amount of capital for a DCA round. Because it can depends on your feeling about the market trend as well as your available funds for DCA at that time. If you see the market is good and you have money in hands, you can DCA with doubled capital than your normal amount.

That's gambling!
DCA is dollar cost average, when you break this rule it stops being DCA and as I said is basically buying based on a hunch or your guts.

The user to whom I replied mentioned clearly that you can "fine tune " it by buying based on market trends.
No way, there is little no way in hell you can say this is still DCA when you buy guessing on what might be next!

Changing your dates from one week to a month or a day, and changing the sum from 100 to 200 for the next month, it can still be called DCA.
But buying for $100 for two weeks then two days later throwing $1000 on a whim and then not buying for 6 months cause you think it will go down is everything BUT DCA!
How can you even have an average here?

[KiaKia]

The exact amount that is big to you might be small to me, it depends on the person that wants to DCA, plans are different, the salaries of everyone on here are also different, you can be able to afford using $500 for weekly DCA into Bitcoin and I might be able to afford $3000 every week to DCA every week, our results will never be the same.

Either it's weekly or monthly, price actions of Bitcoin will also not stays the same, but honestly, it's just an unnessecery discussion, DCA is DCA, evwnry one knows their capacity, and how long they want to DCA for, to me it will work eventually no matter what strategy you use to accumulate your Bitcoin.

The only difference will be amount, how much you are able to DCA into Bitcoin on the long run is what will determine what you will real when the bull market is here, some investors have no fixed price, this week it could be $200 and next week it could be $400, it doesn't matter, but your commitment will bring you the best results in the end.

[Vaculin]

It's crucial to watch how the market goes up and down and change your DCA plan if needed.

The whole point of using DCA is not having to consistenly check the market and obsess & stress about price fluctuations. Instead, you are supposed to buy the bitcoin at the regular intervals no matter the current price, beliveing that price in the long term will go up.

What you explained is basically trying to time the market, which in the end is more about luck than anything else and is opposite of DCA.

Regardless of how the market moves and whatever its price at the moment, DCA is still encouraged since the whole point of it is to mitigate risks by buying at different prices, as long as your goal is to hold them for longer term by not panicking whenever a current price dump occurs. That is to lower the risk from market volatility, and to increase your chances of making you profitable when you decide to sell them at a very reasonable price.