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So, lets say you want to DCA into #Bitcoin but would like to know what to expect based on the history. Yes, yes I know. History does not repeat and we can't make reliable predictions about the future based on the past - but what else do we have?

Anyway I have made a simulation, actually 100k simulations to see what is the distribution of results if one starts DCAing into Bitcoin at a random point in the past and what is the result after random number of days.

And this is the result

X axis shows how many days you DCA and Y axis show what is the return on invested capital.

Remember there is 100.000 simulations or dots on this image and the distribution is truly amazing.

I have so many questions about this.

Why are there orderly empty spaces in the graph that do not have any dots?

Why does it look like a wave a surfer would kill for?

WHY DOES IT NOT LOOK LIKE ANYTHING RANDOM

Anyway if you are interested in numerical statistical results here it is

Platinum Bear 1y ago

Image 2 does not make any sense to me. I know no framework to understand what it is saying. However, image 1 tracks with the longer you invest in an asset the more the return stabilizes or becomes flat. Which would be a good asset to invest in.

I would have thought the % returns would have been higher because of the CAGR of BTC.

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Discussion

plebeian 1y ago

Disregard rebalancing statistics on second image it is for some additional simulations I made but the ROI distributions on second image shows in how many cases ROI is less than 1 (meaning still in loss) and in how many cases ROI is higher than 1, 2 and 5