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RE: Investing long-term with Steem: Time as an overlooked parameter

in #steem8 years ago

basically during the distribution phase VESTS are compounding at around 3% per week, so if you calculate the cost per Mv (million vests) and see a significant dip, then and only then would waiting make sense.

However, if you have to wait for 1 month for a 10% dip, it would have been better to have just paid 10% more and get 4 weeks of 3% gains (compounded)

If your timeframe of waiting is 3 months, then you need a 42% drop in price just to "breakeven" against this increasing ratio of steem_per_mvest

my advice is to just dollar cost average over a couple weeks, it wont get you the best price, nor the worst price. Alternatively to frontload it and become active poster/curator benefits from the increased rate of return from day 1.

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Yeah, waiting doesn't work all that well at a highly inflationary scenario.

Btw cost-averaging on the way down is also a nice supplementary strategy. Perhaps if one starts with a budget and leaves a portion unallocated, he can use the unallocated fund to buy serious or extreme dips. The investor following that route should have a spreadsheet automatically calculating the target prices as these will be changing all the time - and obviously he should be adjusting the market orders frequently...

The price should drop much faster than that, inflation is high, selling pressure is very high. We will soon revisit the 25 cts area per steem.