Dollar Cost Averaging

[sidney]

DCA make sense if assuming assets appreciate > after averaging it after a vest period of time. And gives me a feeling of lock-in period of many months before you realise its a good bet or folly. Am i right?

[kennynah]

DCA make sense if assuming assets appreciate

a big assumption though...

[millionairemind]

DCA make sense if assuming assets appreciate > after averaging it after a vest period of time. And gives me a feeling of lock-in period of many months before you realise its a good bet or folly. Am i right?

Try a DCA approach from 1999 to 2009 on an index fund mirrored on the SP500... you will still be in the RED.

Is ten years a long enough period to show performance of a widely held strategy??

How many 10 years does one have in a life time???

All these crap about "STOCKS FOR THE LONG RUN", "The Stock Mkt always come back up"

The market might come back, but your stocks might be gone forever

[Aspellian]

How many 10 years does one have in a life time???

All these crap about "STOCKS FOR THE LONG RUN", "The Stock Mkt always come back up"

The market might come back, but your stocks might be gone forever

There's also another risk mentioned here - human life is not LONG TERM (to infinity) (I mean physically anyway....)

[Musicwhiz]

Precisely. Thus, focus on your companies, not on the stock market!

[LenaHuat]

IMHO, DCA is akin to a child dropping coins into the piggy bank. The investor must outgrow this mindset.

[Musicwhiz]

IMHO, DCA is akin to a child dropping coins into the piggy bank. The investor must outgrow this mindset.

Tough. I have a friend who firmly believes in DCA, and has been doing it for Mutual Funds for the past 4-5 years. She is now slightly +ve (just breakeven).

[kennynah]

IMHO, DCA is akin to a child dropping coins into the piggy bank. The investor must outgrow this mindset.

i like this description very much.... very apt....very elegant.... wahahahaha.....

[-dol-]

Actually, I think it is a good concept but must be applied very carefully. You must really know what you are DCA into.

It's usually not the method but the practitioner who is the problem.

[LenaHuat]

Exactly. I would use DCA in the manner I've talked abt in the "Averaging Up" thread.