You have seen the price of bitcoin/ether skyrocket and you keep slapping yourself for not getting in early. Perhaps you have some spare change in your wallet and you’re about to hit Luno to buy a shit ton of bitcoin or on wherever exchange. Please calm down and sit on your hands, what you’re feeling is called FOMO (Fear Of Missing Out).
When you FOMO into any investment, the chances of getting rekt can be incredibly high because you’ve made an investment decision based purely on hype. What this basically means is that you could be buying an asset at an expensive price and could get dumped on by others when they sell their investments Which sometimes leads to a severe loss.
How then do you buy bitcoin/ether riskfree you ask? The answer, Dollar-cost averaging.
OK, maybe the title of this writeup is a bit misleading because nothing worth having is risk-free but let me explain how to invest by dollar-cost averaging into anything almost risk-free (wink wink).
What the hell is dollar-cost averaging? Please rest assured this is not a write-up to expatiate or confuse you with financial jargon, however, you need to understand the basic concept of DCA.
Dollar-cost averaging refers to the practice of building investment positions by investing fixed dollar amounts at equal time intervals, as opposed to simply investing a lump sum all at one time. What that means is if you have $1000 to invest in bitcoin, rather than investing it all at once, you could decide to buy $30 worth of BTC every day or $250 worth of BTC every week. When you do that, you’ll ensure you’re buying BTC every day or every week at different prices which will greatly reduce the risk of a potential loss.
Generally, you apply such strategy to an investment you believe you want to hold on to long-term. DCA can be applied to buying Ether also. Do what you will with this information and remember to invest only an amount you can afford to lose.
We discuss ideas such as this in a Telegram Group. You’re most welcome to join us. Have a good one👍.
