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The essence of DCA is that it shields you from the emotional toll taken by fluctuating stock prices. Rather than stress over minor price changes, you view them as potential buying opportunities.
Staggering Your Sales: The DCA Approach to Selling
Just as DCAing applies to buying stocks, the same principle can be applied when selling. It helps to relieve the pressure of trying to pinpoint the exact peak price for selling.
Using cryptocurrencies as an example, seasoned investors often stagger their sell orders. If you believe Bitcoin will reach $100,000, you might place sell orders at strategic intervals—say $80,000, $90,000, and $100,000—to ensure you can capitalize on the upward trend without risking a missed opportunity if the price declines suddenly.