A theoretical look at the last 1000 days of DCA (dollar cost averaging)

I ran a simulation of performing DCA based on a start date going back 50, 100, 150... 1000 days. Here are the results. The simulation assumes a 0.50% taker fee on each buy and investing $1 a day. You can simply multiply all by 20 to do $20 a day. The min column assumes you bought at the worst time each day (24h high), and the max column assumes you bought at the best time each day (24h low). The APR is what standard APR would be required to yield the same returns over the same period. The brackets show that your final value is below the amount invested.

For example, if you would have started your DCA at the ATH (756 days ago) your would still have realized an 8-10% (apr) gain. If you would have started at the 52w high (200 days ago), you would obviously still be underwater, but not by as much as most would expect.

It's an interesting example of how DCA can "iron out" some of the volatility.

Assuming a current BTC spot price of 8070.00 and that you started your DCA so many days ago

Days Ago	max	APR	min	APR
50	55.62	117.594%	55.00	100.575%
100	103.70	14.199%	102.39	9.005%
150	[145.73]	-6.779%	[143.78]	-9.788%
200	[184.10]	-14.035%	[180.33]	-17.215%
250	[235.19]	-8.530%	[229.71]	-11.624%
300	320.08	8.200%	314.34	5.845%
350	429.68	23.848%	424.52	22.299%
400	541.75	31.890%	534.54	30.287%
450	621.70	29.973%	612.04	28.333%
500	683.63	25.653%	674.11	24.372%
550	742.91	22.082%	732.43	20.936%
600	802.64	19.365%	791.39	18.344%
650	852.15	16.423%	839.90	15.480%
700	897.76	13.854%	883.25	12.891%
750	934.72	11.310%	916.62	10.256%
800	977.97	9.598%	957.01	8.520%
850	1066.08	10.215%	1042.08	9.143%
900	1177.55	11.518%	1149.89	10.448%
950	1342.86	14.222%	1306.95	13.039%
1000	1588.39	18.399%	1546.13	17.240%

Number of entry days in the last 1000 that would result in a loss: 167

A better, more user friendly simulator can be found at dcabtc.com ^{( not my site )} , I just provided a table for those wanting a quick high level view.

So if your terribly concerned about when to enter the market, just try a dollar a day, or $10 a week.

^{Market data collected from the Coinbase Pro API}

submitted by /u/brianddk
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