Bitcoin Investing As You SLEEP! How to Dollar Cost Average Bitcoin and Crypto
Hey everyone, I’m going to share with you my investment strategy for bitcoin and cryptocurrency that I’ve been utilizing since 2017. So I started getting heavily interested in cryptocurrencies and especially Bitcoin, right before the big bull market run in 2017. And despite getting in in 2017, I got in a little bit before the big bull run, and at the time, I decided to start continually investing in Bitcoin over a longer period of time.
About two years ago, I decided to make a case study where every month I’m going to be dollar-cost averaging my s&p 500 portfolio versus Bitcoin and see how both of these perform. Now before we get started with this, I want to share with you a quick case study from Charles Schwab, about how they took five individuals.
And essentially, these five individuals have different investment strategies and essentially showing you how things worked out for them. So they have Peter perfect. Peter perfect was a person who timed the market perfectly, he was buying at the lows, selling at the highs, all the things that you could never truly predict the next person was actually action, she took a consistent approach each year, she was investing $2,000 in the market as early as possible.
This is what people call a lump sum investment.
The next person is Matthew monthly, this is the investment strategy that I utilize and that 95% of people should utilize. This is essentially taking a percentage of your income and investing it over a 12 month period. So this person was investing $2,000 Every month into the s&p 500 The fourth person was Rosie rotten opposite to Peter perfect, she was investing at the worst times possible and trying to time the market. So again, if you’re trying to time the market, you’re probably gonna have an average of these, but sometimes there’s gonna be the worst timing sometimes is gonna be the best. And then Larry linger, he essentially left his money in cash, he didn’t invest in s&p 500. And as you can see from this marketing data, you can see what the timing would be like. So the perfect timing was 87,000, that invest immediately the lump sum person. So let’s say you got a large amount of money, just investing in as early as possible, was 81. And then the dollar cost averaging was 79. The next one was bad timing, which was $72,000 earned. And then the person who just kept their money in cash was 50,000. So as you can see, the perfect timing person, the odds of that happening are such a small scale. And then again, most people for the second part about getting a lump sum and investing that the problem with that is a lot of people aren’t getting a lump sum. So they’re earning a monthly income and being able to allocate a percentage of that is going to be way more realistic than getting a lump sum and investing that into the marketplace. So this is why dollar cost averaging is going to work for probably 99% of the market. And it’s going to be the best thing and now I’m showing the s&p 500. But what does this have to do with crypto, essentially, this same strategy can be utilized with cryptocurrencies and with Bitcoin. So I’m going to switch over to my screen, and I’m going to show you exactly how I dollar cost average Bitcoin, and how I’ve been doing this for the past two years. So let’s go ahead and switch over to my laptop. And I’ll show you this step by step process, how you can start dollar cost averaging with Coinbase into bitcoin in as fast as a few minutes. So as you can see here, once you get set up in Coinbase, I’ll leave a link below so that way, if you want to sign up, you can get some free bitcoin, by signing up and depositing some money into your account. But essentially, it’s as easy as setting up a Coinbase account, then you’re going to click Buy, and you’ll be able to set up like Bitcoin, you’ll be able to link your bank account so that way you can have instant buys and purchases. Essentially, what you want to do is let’s say you want to buy $1,000 every month.
And you want to click here it says one time purchase. Again, you’re going to want to set up probably every first and 15th of the month, if you can do it every week, even better. But again, it’s really depend on how much money you want to do. I personally do it twice a month, so every 15 days. So this option here you’re going to preview your buy. And then you’re going to essentially be able to buy this now and this will repeat on the first and 15th of every month. Once you have it in your account. I don’t store any crypto currency in my coin base for more than a few days. So as soon as it hits on the first and 15th Once the order has processed, then I’ll go ahead and transfer it to a hardware wallet. You do see some fees here try to figure out what amount makes most sense. There are some alternatives but again Coinbase is one of the most simple and secure places to buy cryptocurrency. And this is what I’ve been doing for over two years is setting up a bi monthly purchase and acquisition of Bitcoin.
you set this up, you can set it forget it and again, just like the s&p 500 the stock market cryptocurrency is the same. Don’t try to time the market it’s your time in the market that It’s going to make more sense and it’s going to make you money. Essentially, I’m planning on doing dollar cost averaging for the next five to 10 years with cryptocurrencies, with stocks, and I’ve just allocated a percentage of my income, that I’m willing to invest in the stock market. And then I’m willing to invest in cryptocurrencies and I highly suggest you do the same thing, because you will make a lot of money. If you have the patience. If you have any percentage of your income going into the stock market and cryptocurrencies, I guarantee you’re going to end up doing fairly well for yourself. And again, this is what I personally do. This is not financial advice. Do your own research, make sure you’re not investing more money than you’re willing to lose? And again, Safe Investing. If you learned something new from this video, make sure to give it a thumbs up now. Leave a comment below if you learned something new in this video and consider subscribing for the two new videos I’m putting out each and every week.
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Dollar-cost averaging is a smart idea because it allows you to invest smaller amounts of money over a longer period of time, which eliminates the fear of losing all your money. Also, it’s easier to commit to investing a small set amount of money as opposed to large sums of money all at once .Dollar-cost averaging can be a good idea for investors in volatile markets but it’s not always the best solution. Although investing large amounts of money all at once has the maximum gains if done at the right time, DCA has been proven to avoid major losses. DCA is also important because it eliminates the physiological barrier to investing. As well, instead of wasting your time watching the market for dips every day, you can spend your time more wisely learning a new hobby or increasing your knowledge in other ways. Using DCA can be beneficial because it’s easier to enter the market at the right time. This can help you avoid buying at an emotional high point and then seeing a large loss. If you decide that this is a strategy that you want to use, put in an initial investment of $100, but do not invest anything else unless the price of Bitcoin goes up.
Scenario II: Buy on a Dip and Hold for a Year. The strategy recommended in the previous section is best suited for people who are willing to risk small amounts of money. If you have a larger amount of cash to invest, it can be better used in this case. You should start by investing $5,000 in Bitcoin.