How recurring buying works

Q: How does recurring buying work?

You fix an amount and a rhythm, for example $20 every week, and each scheduled purchase buys whatever that amount is worth at the price on that day. The amount stays the same; the quantity bought changes with the price.

Q: What happens when the price falls?

The same amount buys more Bitcoin, because each unit costs less. When the price rises, the same amount buys less. Over many purchases the average cost lands somewhere between the highs and the lows.

Q: Does recurring buying remove risk?

No. A plan that starts near a price peak can sit below the amount put in for years, and stopping early locks in whatever the value is at that point. Past performance does not predict future results.

Recurring buying has two settings and one moving part: a fixed amount, a fixed rhythm, and a price that moves every day. Everything else follows from those three.

The two settings

Amount: the same sum every time, for example $20. It does not change with the price.
Rhythm: how often the purchase repeats: daily, weekly, bi-weekly or monthly.

Keeping both fixed is what makes the method automatic. There is no decision to make on any given day, and no need to judge whether the price looks high or low that week.

The moving part: what each purchase buys

Each purchase divides the fixed amount by that day's price. When the price is low, the same amount buys more; when it is high, the same amount buys less. A simple example with round numbers: at $50,000 per Bitcoin, $50 buys 0.001 BTC (100,000 sats). At $25,000, the same $50 buys 0.002 BTC (200,000 sats). At $100,000, it buys 0.0005 BTC (50,000 sats).

Add those purchases up over months and years and you get three totals: the amount put in, the Bitcoin accumulated, and the average cost, which is the amount put in divided by the Bitcoin accumulated.

What can go wrong

A plan started near a peak can sit below the amount put in for a long time.
Stopping early ends the averaging: the result is whatever the value is on the stop date.
Fees take a slice of every purchase, which matters most on small amounts (see fees, explained).
Missed purchases break the rhythm, so the average cost reflects fewer data points.

Questions

How does recurring buying work?

A fixed amount on a fixed rhythm, each purchase buying whatever that amount is worth at that day's price.

What happens when the price falls?

The same amount buys more, because each unit costs less. The reverse happens when the price rises.

Does recurring buying remove risk?

No. Prices can stay below a plan's average cost for years, and a plan stopped early keeps whatever value it has at that point.

Replay your own plan Back to Learn

Education only, not financial advice. Past performance does not predict future results.