Chapter 26 of 32 · Money
Trading: DCA and Grid bots
Bots follow simple rules for you. A DCA (dollar-cost averaging) bot buys the same dollar amount on a schedule, so you buy more when prices are low and less when they're high. A Grid bot splits a price range into bands, buying when the price drops into a lower band and selling when it rises into a higher one. Both run on pretend money and can be tested on past prices first.
How it works
What you can do here
- Set up a DCA bot: asset, amount per buy and how often
- Compare DCA with buying all at once
- Set up a Grid bot: asset, bottom and top price, grid lines and money
- Test a grid over a past period against buy and hold
1. Setting up a DCA bot
- 1
Open DCA Bot
From the desk menu.
- 2
Choose the asset
Any stock or coin on your watchlist.
- 3
Set the amount and frequency
Amount per buy in dollars, and how often: every day, week, two weeks or month.
- 4
Choose the test period
3 months, 6 months, 1 year or 2 years.
- 5
Read the result
How much you put in, what it's worth now, your return, average price paid and how much you'd own. Compare with All at once instead.
2. Setting up a Grid bot
- 1
Open GRID Bot
From the desk menu.
- 2
Set the range
Bottom price and top price: where you expect the price to move between.
- 3
Set the grid
Grid lines (how many bands) and the money to use. The amount per band is shown.
- 4
Test it
Choose a test period. See what it's worth at the end, the grid profit, days the price stayed in range, and how buy and hold did.
A grid works best when the price moves sideways. Days in range shows how often the price stayed between your bottom and top; outside that, the grid has nothing to trade.
3. Seeing all your bots
- 1
Open Bots
Winston's trading bots in one place. All trade pretend money only.
Try it yourself
Doing is the fastest way to learn. Open the tab and try these:
- Test a $50-a-week DCA into BTC over two years and compare it with buying all at once.