Regular investment or DCA - Dollar Cost Averaging is a simple and smart strategy to reduce the impact of market fluctuations on your investment.
🧠 What exactly is DCA?
It means that you invest a fixed amount of money in a specific asset (like Bitcoin or Ethereum) periodically and regularly, regardless of its market price.
For example:
• You decide to invest $100 every week in Bitcoin.
• You buy the same amount every week, whether the price is high or low.
• Over time, you have a good average purchase price and reduce the impact of strong fluctuations.
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✅ Advantages of DCA:
1. Reducing risks: You don't invest all your money at once, which reduces the chance of buying at a very high price.
2. Avoiding emotions: You are not influenced by fear or greed, because you buy automatically and regularly.
3. Easy to implement: Suitable for anyone, even if they are not an expert in market analysis.
4. Suitable for volatile markets: Especially with cryptocurrencies that have violent ups and downs.
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Practical example:
If you started investing $100 monthly in Bitcoin from 2020 until now, even if the price was high sometimes or low, you would likely have made a significant profit, because your average purchase price would be balanced, and Bitcoin tends to rise over the long term.