Dollar-cost averaging (DCA) calculator for Cardano (ADA) backtesting

Visualise and calculate historical returns of investing $100 in ADA every 7 days from Aug 2022 until now

#9 ADA Today Price

$0.32

1.05%

24H Range

$0.31

avg $0.31

$0.32

Value in FIAT

$1,106.56

-$293.44

-20.96%

in 3 months

  1. Remaining investment

  2. Lost value

ADA selling price

$0.31

1st order $0.45

Average price

Selling price

$0.39

$0.31

Total Investment

$1,400

Over 14 instalments of $100, every 7 days

Earnings over time

Estimate the development of your earnings over time

ADA price over time

Price development vs. average cost

Fact

Investing $100 in ADA from Aug 2022 to Nov 2022 every 7 days ($1,400 in total) would result in $1,106.56 of value! Average price of $0.39 per 1ADA. -20.96%

Profit/Loss every 7 days

Based on your purchase interval you would make profit 14% of the time

What is Cardano?

Cardano is a decentralised platform that will allow complex programmable transfers of value in a secure and scalable fashion. It is one of the first blockchains to be built in the highly secure Haskell programming language. Cardano is developing a smart contract platform which seeks to deliver more advanced features than any protocol previously developed. It is the first blockchain platform to evolve out of a scientific philosophy and a research-first driven approach. The development team consists of a large global collective of expert engineers and researchers. The Cardano project is different from other blockchain projects as it openly addresses the need for regulatory oversight whilst maintaining consumer privacy and protections through an innovative software architecture. The protocol features a layered blockchain software stack that is flexible, scalable, and is being developed with the most rigorous academic and commercial software standards in the industry. Cardano will use a democratic governance system that allows the project to evolve over time, and fund itself sustainably through a visionary treasury system. Technological Innovation Cardano is the first protocol to incorporate Ouroboros, the ground breaking proof of stake algorithm. The IOHK team employed a “first-principles” approach, driven by peer-reviewed academic research to build Cardano from the ground up. The result of this collaborative effort is the first cryptocurrency to be based in Haskell code, which focuses on industrial strength product that delivers the resilience necessary for mission-critical systems, in this case, securing investment. Cardano’s multi-layer protocol performs advanced functions, and has a settlement layer that is elegantly linked to a control layer. The settlement layer will have a unit of account, while the control layer will run smart contracts and will be programmed to recognize identity, assisting compliance (and allowing blacklisting, for instance). The protocol is geared towards protecting privacy rights of users, while also taking into account the needs of regulators. In doing so, Cardano is the first protocol to balance these requirements in a nuanced and effective way, pioneering a new approach for cryptocurrencies. The system is also designed to allow upgrade through soft forks, enabling it to adapt to changing needs and evolve quickly, when required. A treasury system is also being installed that will ensure the sustainability of the protocol. Cardano is built in the spirit of collaboration by being completely open source and patent-free. Engineered for efficiency and scalability, the Cardano ecosystem will develop into the most complete cryptocurrency ever constructed. Conceptual Innovation i. Privacy and regulation The original Bitcoin blockchain was meant to be a way for individuals to transact directly and anonymously with each other outside the control of banks and governments. This guarantees privacy in financial dealings, a fundamental individual right, but full anonymity can be counterproductive. Today most blockchain projects look to further either the aims of privacy or of regulation. To be effective globally, we think our blockchain must ‘square the circle’ by finding the right mix of individual privacy protection and provision for regulatory control. ii. Governance Public, decentralized blockchain projects rely on crowd-based governance models. This allows for democratic control of the network by its participants, which is essential to building truly decentralised economies. However, if they are not carefully designed, such governance can go awry. Both the Bitcoin and Ethereum communities have experienced devastating schisms on the question of how to upgrade their networks – in Ethereum's case already causing a split. The Cardano blockchain has an airtight governance model that allow the community to democratically take clear and binding decisions. iii. Funding The Cardano blockchain has sophisticated maintenance and development needs and is able to adequately fund itself, both in terms of running costs and new investment. The Token: ADA Voucher Every blockchain project has a token of value commonly referred to as a cryptocurrency. Ada is the cryptocurrency on the Cardano blockchain. With Ada, holders can send value between friends, pay for a good or service, deposit funds on an exchange, or enter an application. To perform a transfer on the settlement layer requires you own Ada, or acquire Ada through an exchange. It will also be the native token to be used in applications built on the computation layer. The Wallet: Daedalus Each cryptocurrency requires a “wallet” to store Ada. Typically this wallet is a software application that can be installed on any computer or smartphone. Daedalus is a highly-engineered wallet with advanced security features that was developed by IOHK specifically for the Cardano blockchain and protects your assets with the most advanced cryptography. In the future, Daedalus will not only support Ada, but other cryptocurrencies such as Bitcoin, Ethereum Classic and many more. The Cardano Foundation The Cardano Foundation’s core mission is to standardise, protect and promote the Cardano Protocol technology. The Cardano Foundation acts as a supervisory and educational body for Cardano. Our mission is to: 1. Standardise, protect and promote the Cardano Protocol and its applications 2. Be a community hub offering authoritative, timely information about the technology and Cardano’s wide-ranging potential 3. Liaise and influence government and regulatory bodies, form strategic partnerships with businesses, enterprises and other open source projects and aid the creation of formal software standards for Cardano, a crucial feature for its long term success and critical in adoption and government engagement Areas of Focus: 1. Cardano Protocol - We function as an objective standards body for the Cardano protocol as it evolves over time. 2. Cardano community - We support, grow and help educate the Cardano blockchain community. 3. Cardano ecosystem - We work to expand and protect the Cardano ecosystem. This includes promoting Cardano as a platform for commercial entities and serving as an objective organization for enterprises interested in joining Cardano. 4. Serving the wider blockchain community - We aim to influence and progress the emerging commercial and legislative landscape for blockchain technology and cryptocurrencies in general. We proactively approach government and regulatory bodies and form strategic partnerships with businesses, enterprises and other open-source projects. IOHK Founded in 2015 by Charles Hoskinson and Jeremy Wood, IOHK is a world-class engineering and technology company committed to using peer-to-peer innovations to provide financial services to three billion people that don’t have them. The group is contracted to design, build, and maintain Cardano through to 2020. Emurgo Emurgo is the venture building entity in the Cardano ecosystem, its goal is to aid, integrate, and foster Cardano blockchain applications. Emurgo captures the transformative power that blockchain technology brings to the developing world. Decentralized applications built on Cardano technology, funded and supported by Emurgo, will have the potential to build groundbreaking applications. Project Road Map IOHK has now released the settlement layer. This means you can transact, trade, and purchase Ada tokens fully independently of the computation layer. The goal for the computation layer is to have a beta released by the first quarter of 2018. Once both settlement and computation layers are live, users will be able to setup a custom environment to build decentralised applications on the Cardano stack. In 2019, IOHK intends to work on Cardano’s long-term scalability and augment its capabilities. As developers, IOHK has been contracted through 2020 to make sure Cardano is being adequately maintained. The goal is to create a sustainable ecosystem that is capable of funding and supporting itself.

What is a DCA-CC Calculator and How to Use it?

If you want to test out your investment strategy, you'll need to understand how it works and what you're hoping to achieve. This is where the DCA-CC calculator comes in - it can help you see if your strategy will generate the return you want.

The calculator is separated into two modes: the dollar cost average calculator and the lump sum investing calculator. You can use either one to budget for your investments on a regular basis, or to invest all your money at once.

To use the DCA-CC, start by entering a DCA or lump sum investment amount. Then, select the time period, interval, and investment you want to use. The calculator will show you how your strategy would perform under those conditions. You can also experiment with different parameters to see how they affect your results.

And that's not all! The DCA-CC also lets you see how your investment would fare if you used the lump sum strategy. So if you're not sure which approach is right for you, this calculator can help you compare and make the best decision.

What is DCA (Dollar Cost Averaging)?

DCA is like buying a little bit of your favorite cryptocurrency each week or month regardless of the price. By buying equal dollar amounts at regular intervals, you're helping to smooth out the bumps of a volatile market.

Think of it as when buying a house. When you want to buy a house, you don't just fork over all the cash upfront. You make a down payment, and then you pay the mortgage every month. Over time, the house is yours.

DCA is like that, but with investments. You spread your investment out over time, so you're less likely to buy when the market is high. And just like with a house, you eventually own more and more of your investment.

By buying a little bit of your favorite cryptocurrency each day, week or month, you're making small, regular payments that will help you get the coin you want without waiting for a price dip.

Of course, there is always the risk that the price of the coin could continue to fall. However, this risk can be mitigated by using DCA when the market is trending upwards.

How to use DCA-CC to backtest your dollar cost average strategy?

Do you want to know how effective your dollar cost averaging strategy would have been in the past? The DCA-CC calculator can tell you for sure!

This tool is designed to help you backtest your investment strategy, so you can compare it against other strategies and decide which one is best for you.

When you first use the tool, we'll make some assumptions about your potential investment. For example, we'll assume you're investing $10 in bitcoin every week for the past three years.

Of course, you can change the parameters at any time to get more accurate results. So why wait? Use the DCA-CC calculator tool now and find out how your investment strategy would have fared in the past.

DCA Widgets

Top 3 cards

Value in FIAT, BTC selling price and Total investment cards are the easiest to understand. However, we'll give a little more explanation:

What is DCA Value in FIAT card?

The Value in FIAT card is a great way to see the value of your investments after a dollar cost averaging period. This card can help you understand how DCA affects the value of your investment over time.

The scale on the lower part of the widget displays the investment to interest ratio. In other words: it shows how much of your investment is lost or how much was added to your investment due to the earnings.

What does the DCA Value in FIAT card show?

This card lets you know how much your cryptocurrency is worth in Fiat currency at the end of your investment period. In other words, the price you sell it at.

The card also shows you the price of your first order, so you can see how the market volatility affects your investment over time.

Lastly, the card shows the ratio of the selling price to the average price. This is helpful in determining the value of your investment strategy and how it impacts the selling price.

What is a DCA Total Investment card?

The total investment card calculates how much money you would have invested, given an initial investment and an investment interval, over a specified period of time.

For example, if you invest $100 every month for 3 years, the total investment card would show you how much money you would have invested at the end of those 3 years.

Charts

We are presenting two charts here: a chart of earnings over time, and a chart of price over time. These charts can help provide context and perspective, and allow you to see what would be different if you entered or exited the market at a different time.

Earnings over time

This chart shows how much money you've made over time from your investments. It includes your balance in FIAT (the dollar equivalent of cryptocurrencies) as well as your total investment up to that day.

BTC price over time

This chart shows the price of a given cryptocurrency over time, as well as the average cost of a cryptocurrency on any given day.

This chart can help you understand the value of dollar cost averaging as a strategy, and how it may impact your earnings.

What is a Fact card?

The Fact card is an automated message that summarises all the information from all the charts in a short, sharable sentence.

What is Profit/Loss card?

The Profit/Loss card is a tool that can help you to better manage your risks by understanding how often you might be making a profit. As with everyhing else here, this card can provide guidance and clarity in your decision-making process.

What is Purchase history?

What you'll find here is a table of purchase data, which includes information like how much cryptocurrency you could buy with the money invested on a given day, or how much you would have profited or lost at a given point in history.

What is Lump Sum Investing strategy?

Lump sum investing strategy is a method of investing where you invest a fixed sum of money all at once. This is in contrast to dollar-cost averaging, where you spread your investment into several installments over a period of time.

Lump sum investing has its pros and cons. On the plus side, you only have to make the investment decision once. And, if you’re investing in a volatile asset like cryptocurrency, you may benefit from buying when prices are low and selling when prices are high. On the downside, you could end up buying at the top of a market bubble – and we all know how those end.

So, should you go with lump sum investing or dollar-cost averaging? That depends on your investment goals and your personal risk tolerance. If you’re the type of person who can stomach the ups and downs of the market, and you believe in the long-term potential of the asset you’re investing in, then lump sum investing may be the way to go.

How to use DCA-CC to backtest your lump sum investment strategy?

DCA-CC is a powerful, easy to use backtesting tool that can be used to test and optimise your investment strategy.

The DCA-CC calculator will help you calculate the performance of your investment strategy across different market conditions.

You can also compare your performance against other strategies such as dollar cost averaging.

It's easy to use and only takes a few seconds to set up.

Here's how it works:

  1. Enter the amount of money you want to invest.

  2. Choose the cryptocurrency you want to invest in.

  3. Choose a time range

  4. Press the "Calculate" button.

The DCA-CC calculator will then show you how much money you would have made if you had invested that money in the cryptocurrency at that price.

Lump Sum Widgets

Both lump sum investment and DCA widgets are very similar, yet the strategy we employ is different. Some data is presented differently, so we will mention only these differences here.

Top 3 cards

As with the DCA strategy, we have three key cards here: Value in FIAT, BTC selling price and Total investment.

What is a Lump sum selling price card?

This card displays the value of the chosen cryptocurrency - the current selling price.

It also displays the ratio of the current selling price to the buying price. This information is helpful in showcase the value of your investment strategy and its impact on your selling price over time.

What is a Lump sum Total Investment card?

The amount on the total investment card will always be different from the investment parameter you entered into the calculator. This is because we calculate the total investment using the DCA strategy. Doing this allows us to show you the impact of investing the same amount of money using two different strategies.

As a reminder, in the DCA strategy, the total investment card takes your initial investment and your investment interval and multiplies it over the time period provided.