beginingBlockchainAnalyzesTake advantage of the Dollar Cost Averaging Strategy with Binance…

    Take advantage of the dollar cost averaging strategy with Binance Auto-Invest

    It doesn't matter if you are new to cryptocurrencies or already an experienced trader. The thing is, timing the market to invest in cryptocurrency is no easy task. Well, I would even say that it is impossible because you never know if cryptocurrency prices will go up or down after you have bought. Crypto is too volatile for any short-term predictions.

    This is why I recommend using the dollar price averaging strategy when planning to invest in cryptocurrency.

    Let me explain that this is useful and how it works with Binance Auto-Invest .

    Advantages of the Dollar Cost Averaging Strategy

    Let's say you have $1000 that you want to invest in cryptocurrency. One thing you can do now is invest the whole amount at once, but I doubt that's a smart move when it comes to cryptocurrencies because you don't know if you've timed it right. Cryptocurrencies are simply extremely volatile assets.

    It would be wiser to split your $1000 into smaller amounts and buy frequently. Instead of making one big move, you enter the crypto market gradually. For example, you can buy weekly 20 times for $50 for the next 20 weeks. When you do this, you reduce volatility and take advantage of a so-called dollar cost averaging strategy.

    By reducing the impact of volatility on your investment, you also reduce your exposure to risk. Such a dollar cost averaging strategy has the potential to lower the average cost of the total amount of cryptocurrencies you purchase.

    What is Binance Auto-Invest?

    Binance Auto-Invest allows you to not only invest in cryptocurrency automatically and regularly, but also generate passive income on top.

    Choose the cryptocurrencies you want to invest in, with an amount and timer-interval set in advance. Once you set up your Auto-Invest plan, you can start taking advantage of the dollar cost averaging strategy and build up your crypto.

    At the same time, you will start generating passive income from your crypto purchases as they automatically earn interest from Binance Flexible Savings. This is a great advantage of the Binance Auto-Invest plan, as earning interest on your new cryptocurrency purchases also happens automatically, while you can cash out crypto at any time.

    After you set up your Binance Auto-Invest plan , you can simply sit back and watch your portfolio grow over time without having to be active all the time. This is not only simple, but also quite clever. 🤓

    Create your own Auto-Invest plan

    How to set up your Binance Auto-Invest plan

    Creating your own automatic investment plan on Binance is quite easy. First of all, you need to go to the page Auto-Invest on Binance under the "Earn" tab.

    Binance Auto-Invest Plan

    Now select the cryptocurrency for which you want to set up an automatic investment plan and click on the yellow "create plan" button.

    You can currently set up an auto-invest plan for Binance Coin, Bitcoin, Ethereum, Solana, Cardano and Polkadot. If you wish, you can create an automatic investment plan for just one or all six available cryptocurrencies.

    Since Binance Auto-Invest is a very new product on Binance, there may be more Auto-Invest products in the future.

    Setting up an automatic investment plan

    After clicking the Create Plan button, a pop-up like this will appear to create $BNB Auto-Invest Plan.

    Creating a Binance Auto-Invest Plan

    Choose the amount you want to invest frequently and your preferred stablecoin, either $BUSD or $USDT. You should hold your preferred stablecoin either in your spot wallet or in your flexible Binance savings account.

    Then go ahead and select a recurring cycle for how often you want to buy your chosen cryptocurrency. It can be on a daily, weekly, fortnightly or monthly basis. Click the "Confirm" button and you're done. 

    Note that if you don't have enough stable coins on Binance, the purchase will simply fail and Binance will try to make another purchase on the next auto-invest date. However, a failed purchase attempt will not cost you any fee. The purchase simply did not go through. So there is no risk when it comes to this.

    How to manage your Binance Auto-Invest plan

    You can check and manage your newly created auto investment plan anytime in your Binance Earn Wallet .

    Binance Earn Auto-Invest Wallet

    Here you have the option to pause your Auto-Invest plan or remove it completely. 

    You can also edit your plan settings, such as adjusting the purchase frequency or amount.

    You can check all newly made Auto-Invest purchases in the tab History .

    Purchased assets are deposited into your flexible savings account. From there you can redeem them at any time. For example, you can use them for trading or move them to your fixed savings account to earn even more interest on your new assets.

    With Auto Invest, you can regularly invest in cryptocurrency with a predetermined amount and accumulate your cryptocurrency.

    Click on a star to rate!
    [Total votes: 2 Average rating: 5]


    Please enter a comment!
    Please enter your name here

    This site uses Akismet to reduce spam. Learn how your comment data is processed.


    Last ones

    You may also like…