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Dollar-Cost Averaging (DCA)
Dollar-Cost Averaging (DCA)

Guide on how to use the Dollar-Cost Averaging (DCA) based on Martingale strategy on WunderTrading.

Ben Ross avatar
Written by Ben Ross
Updated over a week ago

DCA is the investment method in which you buy a certain portion of the asset after the determined price deviation. This DCA bot follows Martingale strategy.

To use DCA, go to Terminal and select DCA.

First, you need to select the Take profit type, it can be based on the entry price:

Or Take Profit can be based on the average price of all entries:

Then you need to set 4 parameters

DCA orders count

This parameter will determine how many entries your overall strategy will have. For example: If you will put 3, that will mean that including your initial position you will have 2 additional orders.

DCA order price deviation

This is the value in % which determines the deviation of the additional entries from the entry price. Example: If you go long and the price of the asset is 100$ and you put an order price deviation of 1% that will mean that the first additional entry will occur when the price will drop by 1%, the second entry will be triggered when the overall price will drop by 2% (as the interval between the first and the second additional entry will be 1%).

DCA Order Volume Multiplier

This parameter will determine the amount that you put into each additional position. If this parameter is equal to 1 that means that each additional entry will be equal to the initial amount. The extra volume will be added to your position from the second DCA entry. Example: Your initial position was 10$ and your Volume Multiplier is set to 2. When you reach your 1st DCA target your additional order will have the same volume of 10$. When you reach your 2nd DCA target your additional order will be 20$ (previous position volume * multiplier). Your 3rd DCA target will place the order of 40$.

DCA order price Deviation Multiplier

This value will increase the price deviation between each additional entry. It is calculated as the price deviation multiplied by the deviation multiplier. For example: if you enter long at the price 100$ and have the price deviation of 1% with the price deviation multiplier of 2 that will mean that the first additional entry will occur when the price will drop to 99$ however the second will occur when the price will go to 97$ (deviation of 3% = 1% * 2). The third additional position will be entered at 94$ (deviation of 6% = 3% *2).

Example of the DCA strategy in the position tab

Take profit and Stop loss for the entire strategy will be calculated from the entry price. If you will edit the Take profit, Stop Loss, or Trailing stop while the strategy is running the new levels will be calculated from the average position price.

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