Talk:Dollar cost averaging

message: There is not much in this article, but a definition, also the article is clearly biased against DCA, not enough balance.
Agreed.  The article is clearly biased.  A lot can be said for or against DCA, and even if you are of the opinion that it is a poor technique, it would be better to attempt to explain why than to simply state a criticism.  People who know nothing about it may assume it is an unwise without understanding any detail.  --Johnsm2 23:13, 15 December 2006 (UTC)
thread_title:  Too scant and unbalanced 

message: It shows the weakness of Wikipedia exquisitely.  If you didn't know that democracy and truth are incompatible, then read this article to find that out.
Setting aside the granularity of the transaction to minimize transaction costs, dollar cost averaging has long ago been incontrovertibly and mathematically proven to be the best strategy in the absence of asymmetric (insider) information.  The controversy?  Giving that financial advice is a massive industry, and trading on insider information is illegal, it is inevitable that people in positions of influence (i.e. talking heads) are going to say the moon is made of cheese and you should listen to their advice and don't use dollar cost averaging.
24.22.167.81 (talk) 01:25, 5 February 2012 (UTC)
thread_title:  I love this article 

message: The investor who has a stream of income (e.g., a dependable periodic paycheck) of which she would like to invest a part in mutual funds is investing in a pattern that seems similar to dollar cost averaging, but in fact the full investment is being made each time with no "spreading".
:I think I know what it means, and actually agree with it, but it seems that there must be a clearer way to say it. ike9898 03:06, 18 January 2007 (UTC)
thread_title:  Can you improve this paragraph? 

message: I made some substantial edits to try to better elucidate the point of the tradeoff between expected performance and variance of performance when implementing DCA.  That's the main point here.  When expectations are for positive returns, DCA will cost you some return but will reduce the variance of your outcomes.  I also added some relevent work on DCA horizon and some advanced techniques. Peters33 16:44, 6 June 2007 (UTC)
thread_title:  New edits 

message: As noted in the terminology question below, this article describes a strategy that is independent of the currency in which it is conducted, and having a Neutral Point of View would seem to imply that the title should reflect this.
So, would it be appropriate to rename this article to "unit cost averaging"?
Martin Kealey (talk) 01:06, 7 January 2016 (UTC)
thread_title: Renaming

message: Is there a currency neutral term for dollar/pound cost averaging? What does the rest of the world call it? 147.252.92.148 (talk) 14:57, 16 May 2008 (UTC)
replies: text: According to the article in the German Wikipedia, the currency-neutral term is "Cost Average Effect". --Kalbasa (talk) 15:39, 12 January 2009 (UTC)
thread_title: Terminology

message: Investment amount for a current bear market purchase: $500.00 USD
Select number of shares to buy below based on current price...
$0.01 per share: 50,000 shares
$0.10 per share:  5,000 shares  Note:  There are 10 of these in 50,000...
$0.25 per share:  2,000 shares  Note:  There are 25 of these in 50,000...
$0.50 per share:  1,000 shares  Note:  There are 50 of these in 50,000...
$1.00 per share:    500 shares  Note:  There are 100 of these in 50,000...
$1.25 per share:    400 shares  Note:  Opps...  Only 100 shares less than for $1.00!
$1.50 per share:    333 shares  Note:  Opps...  Only 167 shares less than for $1.00!
Need we say that we should sell (instead of buying) at more than $1.50? 
Caution: If a penny stock company closes permenently from business the share price will be nothing at all.  What other risk is there?  Time loss?  Company debt should be 50% or less to survive the economic downturn.  Also, a resonable sales of survival type products.  Reduce your cost average over multiple buys.  Than hold for the bull market.  Then sell after significant economic recovery. 
UnderTwoBucks (talk) 00:09, 30 January 2009 (UTC)
thread_title:  Penny Stock Averaging Table 

message: I don't know if it's the case in all DCA plans, but the ones that I've seen do not have transaction fees, you buy them through a bank or fund and pay a percentage of your average investment through the year.  I'm not sure it should be given as an argument against DCA.  TastyCakes (talk) 15:13, 19 August 2009 (UTC)
replies: text: If you work out a DCA plan with an investment firm and are contributing to a fund of sorts, they would likely waive transaction fees. However if one were to do this on their own with pure stocks, (IE using Scottrade or the like) you would take huge margins with trades. @$7 per trade, doing a $100 monthly purchase, you're already taking a 7% loss of the return. However, it seems unlikely that someone who is going to utilize DCA is also not the person who is going to frankly purchase stocks, either. So it's entirely feasible that you could rack up huge trading fees, but not entirely likely.Tmoore121 (talk) 15:50, 17 June 2010 (UTC)
replies: text: This seems a spurious argument, as any transaction fees would be a constant thoughout the investment lifetime.  For example, if a persoon were dollar-cost averaging into a Mutual Fund A-share, all fees are a constant percentage of the amount invested and paid up front.  Therefore, when factoring in the amount of gain the fees are already taken into account. Rapier (talk) 17:33, 15 January 2011 (UTC)
replies: text: I think there is confusion here, rarely are their fixed transaction fees for mutual funds and ETFs. I think the transaction fee argument only works for pure stock purchases, which I doubt many people dollar cost average on. Anyways, the statement is original research without WP:V references, so it should be deleted unless more references are added. --MATThematical (talk) 06:42, 16 June 2011 (UTC)
thread_title:  Transaction fees 

message: In August Substar added a "citation needed" tag to the claim "the market trends upwards over time". This does not seem to me to need citation, so I would like input on whether it does and, if so, what kind of citation might be called for. A good overview of several academic studies on the topic of long-term returns can be found here and Shiller's venerable data set here. Both establish long-term upward trends, which is all that I was trying to claim. Perhaps my claim should simply be revised to include a time horizon. For example, "the market trends upwards over long periods of time". This altered claim still functions as grounds for the following statement that tomorrow's prices are, on average, higher than today's. Disagreement would be equivalent to the claim that the market has no internal rate of return, a position that I don't feel needs to be cited against. Input? If I don't hear anything after a while, I'll add "long periods" and remove the "citation needed" tag. Furball4 (talk) 05:46, 15 January 2011 (UTC)
replies: text: It seems you have discovered a citation for the claim.  Why not put it in and remove the tag? Rapier (talk) 17:25, 15 January 2011 (UTC)

text: I added the citation, and also used more hypothetical language to retain the explanatory value while avoiding the claimed bias (several new 'citation needed' flags were added by 75.147.140.141). I still disagree with the need and think it only adds clutter. If investors do not expect the market to increase over time, they do not put their money into it. Alternative expectations are therefore irrelevant in discussions of how to schedule such purchases. If we are allowed to assume nothing at all, this article will end up being very long indeed. I also altered the language of investing 'tomorrow' to investing 'at a future time', because I meant 'tomorrow' in its purely generic, metaphorical sense. The market can technically rise while having more down days than up days (which would result in tomorrow's prices being lower than today's, on average), as long as the up days are larger in aggregate. But again, this has no meaningful impact on a discussion of DCA and its confusion with automatic investing. Furball4 (talk) 04:54, 14 March 2011 (UTC)
thread_title:  Confusion 

message: Does anyone have a reference to any paper or write up for a complete mathematical treatment on this topic? I found it difficult to form my opinion without resorting to some math.  — Preceding unsigned comment added by Zsljulius (talk • contribs) 17:39, 18 October 2013 (UTC)
thread_title:  Mathematical treatment of this topic? 

message: :’’As the amount of shares that can be bought for a fixed amount of money varies inversely with their price, DCA leads to more shares being purchased when their price is low and fewer when they are expensive. As a result, DCA lowers the total average cost per share of the investment, giving the investor a lower overall cost for the shares purchased over time.[1]‘’ 
DCA lowers the cost per share of the investment compared with...what? The statement is too vague to judge or test its validity. I suggest it should be moved lower down the article, and made into something clearer and more meaningful. (I suspect though that if it is turned into a precise statement, it might easily be proved a fallacy with a bit of maths.)
:’’One key component to maximizing profits is to include the strategy of buying during a downtrending market, using a scaled formula to buy more as the price falls. Then, as the trend shifts to a higher priced market, use a scaled plan to sell. Using this strategy, one can profit from the relationship between the value of a currency and a commodity or stock.’’
This contribution seems to be decribing a contrarian investment strategy which is distinctly different from dollar cost averaging. What is it doing here?
Jonathan G. G. Lewis 03:59, 14 January 2014 (UTC)
thread_title: Dubious content

message: This sounds like a Martingale strategy. It's not sustainable, It's gambling. 129.180.158.114 (talk) 11:49, 22 July 2014 (UTC)
thread_title:  This sounds like the Martingale system??? 

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thread_title:  External links modified 

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thread_title:  External links modified 

message: Sub-optimal compared with what? DCA is a solid satisficing investment strategy; the perfect is the enemy of good enough. This article needs a thorough clean-up, so once I get a round tuit... kencf0618 (talk) 17:23, 22 February 2022 (UTC)
thread_title:  Sub-optimal? 

message: The section 'Discussion of the risks and benefits of dollar cost averaging' reads like an opinion piece rather than an objective summary of literature. Definitely should not be on Wikipedia in it's current form. I don't have the knowledge to rewrite it, so I hope someone else can clean this section up.  — Preceding unsigned comment added by Theritm (talk • contribs) 07:30, 4 May 2022 (UTC)
thread_title:  Basically an opinion piece