This is what investing in Bitcoin on red days gives you

Tuesday 01 December 2020, 1:08 AM AEST - 1 month ago

One moment Bitcoin looks set to breach its all-time high and the next, its down by $3,000. Welcome to crypto!

In a bull market with bearish overtones, a lot can be lost in the noise. For instance, if youd bought Bitcoin last week and sold it this week, youd be down by around 14 percent. Thats not a number one would associate with the best performing investment all year. And yet, thats whats happened.

adada.jpgSource: Coinstats

For Bitcoin to get back to its glory days, and by that, I mean where it was a week ago, it has to regain around 16 percent of its value. This regain, or lets say recoupment, is important because its the theme of this two-part article.

How much would you be in the green by, despite investing on all the red days in the Bitcoin market? Lets dive in.

Groundwork

Bitcoin has to recoup around 16 percent or rise by 16 percent (or thereabouts) to get back to its $19,300-high. Similarly, the opposite is true for price gains. So, if the price of Bitcoin rose, then in order to recoup or get back to its previous low, the price has to drop. This may seem confusing at first, so lets break it down into simpler terms.

DayPriceAmount lostPercentage loseAmount recoupedPercent recoupedDay 1 $ 100.00 $ –0.00% $ –0%Day 2 $ 90.00 $ 10.0010.00% $ 10.0011%Day 3 $ 80.00 $ 10.0011.11% $ 10.0013%Day 4 $ 70.00 $ 10.0012.50% $ 10.0014%Day 5 $ 60.00 $ 10.0014.29% $ 10.0017%Day 6 $ 50.00 $ 10.0016.67% $ 10.0020%Day 7 $ 40.00 $ 10.0020.00% $ 10.0025%Day 8 $ 30.00 $ 10.0025.00% $ 10.0033%Day 9 $ 20.00 $ 10.0033.33% $ 10.0050%Day 10 $ 10.00 $ 10.0050.00% $ 10.00100%

Say you invest $100 in an asset on day 1 and on day 2, it falls to $90. Thats a $10 or a 10 percent loss. Now, in order to recoup, or get back from $90 to $100, you need to gain $10 or make an 11 percent gain on your $90 investment. This will continue if the price drops from $100 to $10, and your rec ...

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