This company did a bunch of simulations of 200 years of dollar cost averaging (DCA) into the S&P run at various volatility levels. The volatility was varied but the total return was kept constant.
Graph: http://ift.tt/2phef4t
(full article: http://ift.tt/2oSJLt0)
What is surprising to me is that dollar cost averaging tends to outperform when put into more volatile investments that have the same compound annual growth rate. Why would this be? If the growth rate is the same, wouldn't you expect to invest when the ETF is above the S&P exactly as often as when it is below the S&P?
Submitted April 09, 2017 at 09:03AM by gnurd http://ift.tt/2ph6yLM
