The idea of DCA or Dollar Cost Averaging is to invest your dollars into the stock market. Trading, as you know is by far one of those things that people do because of its positive results. Well, if you want, you can invest all in one go or do it in turns. But, will DCA be a good investment in the crypto market? If you know about DCA or Dollar Cost Averaging then you should know about its slow pace. But there is something that makes its fans crazy about converting DCA into Bitcoin.
In this post, you will know about three reasons why Dollar Cost Averaging is a good investment strategy.
1. Slow But Steady Takes The Trophy
Yes, you know about this popular saying and its significance. Unlike other crypto investments, this one is not going to make you rich within days. To some people, this drives away the interest but those who stay back, become triumphant.
What makes DCA lovable is that the key here is to take small steps and invest. This is very different from what you do in case of other investments. Big investments in the trading world can either bump up your luck or kill it. But here, taking small steps can smooth out the bumps and you win the match being a tortoise investor.
2. Losses Do Not Hurt You That Bad
Suppose, if you have a thousand dollars in your hands and want to invest in the crypto market, you have two options:
- Pour all out at a go and wait for the consequences whether they are positive or negative.
- Hold back the amount, do small investments, and keep going on with this process for years.
- Chances of losses hitting you hard are minimal in the case of DCA.
3. Be A Investor Who Has The Guts
No, you are not going to read psychology notes here but something simple. In the case of DCA, you can be the proudest investor around. These crypto markets fluctuate a lot and therefore, a lot of fear and panic associate with every big investment made. This is not at all the case of DCA and you know why.
Packing things up, let’s get straight to the point – should you step ahead and go for DCA into Bitcoin? Yes, is the answer if you have patience and want to earn your bucks no matter what.