Dollar cost averaging Investor tool
What is the DCA Investor tool?
It's a tool that will help you take a lump some investment, divide it among the coins you enter, based on percentage. Then it will look up that coin's price, if that coin's price is above your state max price, it will then suggest your buy the alternate coin. We leverage Coingecko's API for the current price.
Why did we build our DCA Investor tool?
Last year we did not DCA buy as well as we should have. Also we did not set any upper limits on our investments. We purchased some coins near their peak, and where are we now? (In a Flo Rida voice) Cryptos got low, low, low, low, low, low, low, low. But hey, did we really lose anything? We haven't sold! But guess what? We can do better. So in order to get better we thought to ourselves, that it would be nice to set some rules for our investing. No more FOMO, no more buying during the pump. We should set some rules for investing.
Our investment rules
We do this each month, because consistency is the key to anything.
- After paying bills, determine how much cash we have left over for investing
- Determine which coins we are going to buy, we have a limit of 5 or so
- Set a percentage of the investment allocated to each coin. Example: $BTC should get 30% of our investment
- Next, if $BTC's price is over a certain amount. It would be smart to buy an alternate. For us this would be a stable coin
- Do this for each coin we in our list
No feelings, no emotions, purely rational with rules.
Investment with rules example
Investment amount: $200 USD
| Coin | Percentage | Max Price | Alternate |
|---|---|---|---|
| BTC | 40 | 65000 | DAI |
| ETH | 30 | 4500 | DAI |
| ADA | 15 | 3.50 | DAI |
| SOL | 15 | 100 | DAI |
Rules applied to data
Now it's the 6th of the month and it's time to invest. We have $200 USD to invest, so let's run through our rules engine. We start with our first coin in the list, and look up its price using Coingecko. If the value is below our max price then we will buying it this month. Let's say that both $ADA and $SOL are above our max price. Our rules engine would then suggest buy the alternate listed instead. And our table would look like this:
| Coin | Amount |
|---|---|
| BTC | $80 USD |
| ETH | $60 USD |
| DAI | $60 USD |
The alternate can be any coin you like. Our strategy this year is to buy a stable coin when the prices of assets we wish to own are above our max. Why would we do this? When prices rise, eventually there will be a correction. When this happens it's good to have some cash on hand to invest when the market drops. There's nothing worse than not being liquid enough when that happens.
Using the DCA Investor tool
All the fields are required. The tool does not provide investment advice, it's made for education and entertainment purposes. As with anything you read on this site, DYOR!
- Enter the investment amount
- Select the currency
- Select the number of investments you are going to split your investment amount into. Example: BTC & ETH, select 2
- Fill out the Investment Matrix
- Enter the coin ticker the ticker assigned for the coin. BTC for Bitcoin, ETH for Ethereum, etc.
- Enter the percentage of purchase, this is the percentage of the total investment that you would like to allocate to this asset. Only numbers, no % sign
- Enter the max price you would purchase this asset for. Example, 65000. Only numbers no currency symbols
- Enter an alternate purchase ticker symbol. In case your primary choice is above your max price, it will suggest that instead of the initial ticker entered.
- Click Validate this ensures the form is valid
- Click Generate
Fetching the results will return two things:
- A re-usable matrix of the data you filled out in the form. Save this for next time and use the code view
- Your results
The investment matrix is generated using the Coingecko api to get prices.
I hope you find this helpful. If you have any questions or comments, please visit our discord