DCA vs Smart DCA, what do you choose?

[Rruchi man]

Personally I see a traditional DCA strategy is better.

Traditional DCA does not require any serious knowledge, just requires some level of commitment to achieve success. It will be easier for a new investor to easily adopt the traditional DCA because it requires simple knowledge.

Traditional DCA is okay for me, and will also be my recommendation to a new investor.

[Ojima-ojo]

Smart of what ever you perceived it to be, what I know is that, when it comes to Bitcoin investment it good to have an entry price that is low and also to sell at high price, so DCA have to do with luck and chance's and it not far from what you have said as at the interest that comes with taking advantage of the vitality of Bitcoin and what the chances there presents.


Although this present it own risks, but with all you will still be at advantage holding more Bitcoin and what comes along the line while the price keep recovering from price corrections.

[Reatim]

Well a lot, if not all, of people do this already. It’s quite the simple concept of
“buy low, sell high” that was typical used in stocks back then but is still very much
relevant until now.

The problem with this is that those people that aren’t that rich might not
have enough funds to buy bitcoin when it suddenly corrects itself.
This is why sometimes putting in small
amounts of money regularly is much better than buying a huge amount of
bitcoin all at once during a dip

[The Cryptovator]

The DCA strategy is already a smart accumulation strategy. So I don't see any other abbreviations for Smart DCA. It's pretty simple: buy each dip you find and hold it. So when it pumps, you will have good profits considering your average purchase price. For new investors, the DCA strategy is already a smart strategy. But for panic traders or holders, DCA won't be smart. They might become panicked and sell off their holdings. The smart holder strategy is called the DCA strategy, by the way. 

[Dr.Bitcoin_Strange]

To start with, it's not even everyone that knows about the normal DCA, so there are many newbies that doesn't know about smart DCA. I got to learn about DCA after I joined the forum, although even before then, I could only buy Bitcoin when I had the money that I was convinced I would not use for some time. But the DCA strategy opened me to a lot of ideas about Bitcoin investment, and that's why I believe that some people are just cool with DCA, and for some reasons, like being emotional because of price drops and increases dynamically, some will just want to invest weekly or monthly in a proportional manner as regards their income flow. When one cannot be patient enough to do smart DCA, it is better to just buy whenever you have the money, and based on the time interval, the person has already agreed to invest. 

[Troytech]

Just another name for trying to time the market which has proved not effective, I guess smart DCA would only work for those that have enough time to stare at the charts all day long waiting for the opportunity to buy to come which would be draining on energy and also has a lot of down sides, the normal DCA is far better cause it doesn't involve any timing the market and you can set your dca plan in a way that anytime they is a dip you increase your allocations or lump sum at such intervals so yeah DCA is a far better strategy.

[Ultegra134]

I hadn't heard of the term smart DCA before; it's a little more complicated than traditional DCA, and I'm not overly confident in how consistent you can be. Buying the dip isn't something that you can do on a weekly or monthly basis. Traditional DCA works just fine when there's consistency. However, it has faults when you're sticking to a plan, such as buying at excessively high prices. I'm more keen on taking advantage of the dips and buying higher amounts of Bitcoin, such as purchasing $200 worth of Bitcoin instead of $50, which is your original plan.

[pawel7777]

I hadn't heard of the term smart DCA before; it's a little more complicated than traditional DCA, and I'm not overly confident in how consistent you can be. Buying the dip isn't something that you can do on a weekly or monthly basis. (...)

That's a good point and kind of shows another flaw in the Smart DCA strategy. In the classic DCA, you can easily allocate a budget that you're comfortable with and make regular purchases, whereas in the Smart DCA, you don't have a clue how often will the dips occur. I guess you could still put the same amount aside (e.g. each week or month) and spend it all when the dip finally happens, but, to me, that sounds awfully risky as you could end up sitting out through cheap price periods.
From all the comments in this thread it seems fairly clear that, for most people, the classic DCA is a better choice.

[Ultegra134]

That's a good point and kind of shows another flaw in the Smart DCA strategy. In the classic DCA, you can easily allocate a budget that you're comfortable with and make regular purchases, whereas in the Smart DCA, you don't have a clue how often will the dips occur. I guess you could still put the same amount aside (e.g. each week or month) and spend it all when the dip finally happens, but, to me, that sounds awfully risky as you could end up sitting out through cheap price periods.
From all the comments in this thread it seems fairly clear that, for most people, the classic DCA is a better choice.

The classic DCA is a fool-proof, newbie-friendly method for the majority of users. The smart DCA has major flaws that can ultimately prevent you from actually performing DCA by constantly postponing your purchase. That doesn't mean that the traditional DCA doesn't have any disadvantages, the most important of which is purchasing at peak prices. Perhaps a combination of both is ideal, but it is certainly not a newbie-friendly option. Your best bet is to  take advantage of dips and invest higher amounts during major price dumps.

[Maus0728]

I thought that DCA is just DCA, no matter what time of the market you do it, it's just that? Quite surprised to see that this isn't the case but I guess, I know now. What's exactly the difference of normal DCA to a smart DCA though besides the Smart DCA having to do with the price correction? Wouldn't it be an obvious thing to do to adjust your DCA when the price starts to go down or up in prices? I think that we're just messing with a lot of people now with this thing that there's an addition of another kind of DCA, just call it DCA if you ask me, it's not like there's a difference, at the least DCA as we know it is flexible enough unlike with this new one, that seems to rely on predicting the price of bitcoin just to make sure that it works well, it could in theory work well but I don't think that every person has the foresight required to do it really well.

[hatshepsut93]

I wanted to remind you about the concept of Smart DCA, purchasing BTC during corrections, when the price drops below the 1W-1M Realized Price.

This strategy works well during a bull rally and is much more effective than classic DCA.

But you know what's even better than this so-called "smart DCA"? A lump sum investment ideally in the bear market, but early in the bull run works too. DCA should only be the tool for those who have no savings and want to save a little bit of money from their montly paycheck. But they shouldn't hope to make big returns, because you need money to make money. Even if you DCA $100 every month and they got up 10 times, it still won't change your life.

[Helena Yu]

But you know what's even better than this so-called "smart DCA"? A lump sum investment ideally in the bear market, but early in the bull run works too. DCA should only be the tool for those who have no savings and want to save a little bit of money from their montly paycheck. But they shouldn't hope to make big returns, because you need money to make money. Even if you DCA $100 every month and they got up 10 times, it still won't change your life.

Lump sump strategy pretty much like go big or go home i.e. high risk,high reward.
Smart DCA is moderate risk, moderate reward.
While DCA is low risk, low reward.

Correct, investment into stable asset won't change your life if you don't have high income sources and willing to hold for many years. This is the reason why some people choose to gamble on shitcoins.

[WatChe]

In other words, buy the dip.

It's not only work during bull season, but during bear season too because you will able to accumulate more coins. The problem of using this strategy is you need to check the price everyday to get updated and you need to set a budget how much you will buy for the dip, the dip could happen continuously in one month and it could be not happen in one month because the market is bullish.

I would go with traditional DCA method for accumulating Bitcoin since it's tried and tested. There is no ambiguity in DCA if you follow that strategy for longer period of time. I am not much familiar with smart DCA, in fact this is for the very first time I am reading about smart DCA. The issue with Bitcoin is that it's difficult to detect when it's the start of the dip and when it's bottom. Anyone who going with buy on dip will struggle to find the dip and bottom.     

[GreatArkansas]

Overall, it's still Dollar Cost Averaging (DCA) 

The most important here is we must have the confidence to buy Bitcoins without any regrets because that's how the Dollar Cost Averaging (DCA) works.
And that's also common problem of people who wants to buy Bitcoin, they just keep telling to buy but they can't do it.

[Darker45]

I also think that the traditional DCA is better. Buying during price drops may be good but what if one long green candle is followed by another long green candle, and another one, and then another one again? You've already missed a lot.

If buying during corrections is really attractive for you but you don't really want to time and analyze the market all the time, then you can integrate it with your existing DCA strategy. It doesn't have to disrupt your DCA schedule. You can have the traditional DCA, but you will also set aside amounts in case there is a correction that's deep enough for you to make the most of.

[bitzizzix]

What I know is that DCA is just DCA, and in terms of smart DCA or whatever, I think it's just part of the strategy, including increasing purchases when the market is down and also having good analytical skills.
Because I think many people do DCA but have a good strategy when the market is declining and I think that is a normal thing.
However, what is certain is that DCA is a good strategy and is suitable for investors who do not have the ability to buy in large quantities or the ability to carry out analysis. However, they can do so according to their ability to buy Bitcoin regularly every month, week, or several weeks on a regular basis and aim for the long term.

[Z390]

I don't care which one is best, DCA is DCA to me.

I only DCA when it's convenient for me, it's not a do-or-die  thing that I have to get over with, I am human and I need to cherish every moment too, sometimes I DCA every week and sometimes once a month, it depends on the situation at present, I have responsibilities e.g bills and other.

Buy when there is a dip in the market and wait for your next payout, even if I get my next payout and the assets I want to buy have skyrocketed I won't be buying for that week, I will wait for a retracement or correction if it doesn't happen then I move on, but in the case of Bitcoin I always DCA at whatever the price is at.

Remember, it is still DCA, do not inconvenient yourself about it, invest money you won't need for many months to come, and if you can't afford to DCA in a month it's also fine, it should be convenient, it's why its called Dollar Cost Averaging.

[kryptqnick]

Hm... I think I'd choose a mix, actually. During the regular or bear market time, I think regular DCA is totally fine. It's simple, it saves time and nerves because you don't actually have to worry when you're buying your coins, and it allows to effectively accumulate BTC. But perhaps during the rapid bull market, this Smart DCA can be more helpful. Maybe it's not worth it, but it kind of makes sense. When I say 'rapid bull market', I'm trying to make a distinction between, say, all of 2023 and February-March of 2024. In 2023, the price was growing consistently but gradually, and I think regular DCA is okay for such times. But in times of fast growth, like in 2024, perhaps smart DCA is worth looking at.

[slaman29]

You know what they key thing about DCA is? It can be used by anyone, anytime. No time wasting, no thinking, no analysis. That's why it's perfect for people like me.

Smart DCA just sounds like a version of trading analysis, if you get it wrong you won't lose money but you'll lose time and experience the same frustrations of traders making wrong calls.

[0t3p0t]

I am currently sticking to the traditional DCA since for me it is the most safe and no stress strategy to acquire Bitcoins. The only problem here is the capital for me since I have no stable job right now aside from my signature campaign rewards which also serves as a weekly DCA. So far I am doing great with this strategy and I think I am sticking on this onwards.