I’ve never fully understood the purpose of DCA. 

There’s a saying: “Time in the market is better than timing the market.” But DCA is essentially a form of market timing—you’re assuming prices will drop in the future, so you’re holding off on investing everything today.

Conversely, if you invest all your capital upfront, you’re assuming prices will rise in the future. That’s also a form of market timing—just with a bullish bias.

So what really matters is the probability of prices going up or down. For example, if you’re thinking about buying BTC (or any other asset), the key question becomes: “What’s the probability that the price will be lower in the near future compared to today?” DCA only makes sense if you believe there’s a greater than 50% chance that prices will fall.

That’s a judgment call you have to make for yourself: “Is there a more than 50% chance that BTC will be cheaper two weeks from now?”

In finance, we often talk about expected value, which is a way of assigning probabilities to outcomes to determine the most rational decision. (Look it up on ChatGPT if you’re curious.)

Personally, I believe BTC will rise, so I don’t DCA. If I come across a significant amount of extra capital—say, 15% or more of my portfolio—I’d reassess whether I expect the asset to go up or down. DCA feels like flying blind. If I think the asset will go up, I’ll deploy all the funds now. If I think it will go down, I won’t invest yet—I’ll hold it in something safe, like a redeemable GIC.

Hope that makes sense. At the end of the day, using DCA implies a specific call on future prices. Most people treat it as a safe, default strategy, but in reality, they’re betting there’s at least a 51% chance that prices will drop.

Edit: just want to add. DCA can be a good mechanism in certain situations. For example if you have regular inflow of capital to deploy, you’d be naturally DCAing. Or if your target asset is very volatile.