Parameters for this experiment:

$1000 of BTC is given to 2 portfolios, june of 2020. or about 0.098 btc. I setup a specific rule every month when to buy or sell bitcoin. This is not timing the market, this is using rules that I specified beforehand to when I buy or sell btc.

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buyback / profit indicator

I made this expecting I would be using the darker shades.. (the percentage of profit / loss is calculated monthly) but sadly bitcoin would not 2x within a months time :(

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value in USD

So why did hold win? Well since taking profits does not time the market, it prematurely sold its BTC before we truly pumped. even 10% monthly sell-offs overtime would be enough to ruin the momentum of a big pump.

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Something to notice, although HODL'ing did make more profits, it lost a lot more money when going back down, we see that during the crash in may, the taking profits portfolio nearly equaled the hodl portfolio. this makes sense, taking profits and buying back in therefore would mitigate risk, for lower rewards.

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btc owned

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I just wanted to say I like the little btc symbol it's so cool.

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about 30% of btc was sold in our taking profits portfolio, sounds grim?

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fiat money held

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not really. If you were to spend all $652 on bitcoin to buy back you would get another 0.0165 BTC. 12%~ loss of btc. But that's the price to pay to mitigate your risks in crypto, since you already have $650 liquidated, if bitcoin drops more then the taking profits portfolio may be more valuable than HODLing.

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in conclusion

both are very viable ways of investing. Within the last year, if you took profits, you would lose about 12% of profits compared to hodling. (assuming you follow my very arbitrary way of taking profits / buyback, like, there's probably better percentages you can go off of)... when taking profits, you lose much less during a bear market. It's a nice way to mitigate risk.

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People who live in America may prefer hodling because of capital gains tax and trying to track every single transfer makes for an angry tax advisor (i think I made mine mad), and people who hodl will more likely stake their crypto. Although people who can easily trade fiat for crypto without tax repercussions and would like to mitigate their risk may take profits.

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neither one is better, it just depends how you invest and trade.