market timing versus DCA

[aja8888]

Me

Me too!

 

[MarieIG]

Me too!

So, who's buying today?

Little bit . . .

 

[imjustawarrior]

So, who's buying today?

I missed all the fun. I was out hiking. Also, I don't keep any dry powder. I stay fully invested. I'm a boring 3 fund Boglehead investor.

 

[pjigar]

Everything I have ever read says lump sum is best because markets rise more than they fall.

Yes, if you have the money available then sooner is always better

 

[yakers]

Me

Me too, just a bit of VT

 

[TheWizard]

Today was an excellent day to buy the TACO dip, but I've exhausted all my free cash for now...

 

[FD1000]

Everything I have ever read says lump sum is best because markets rise more than they fall.

+1
For investors who don’t want to take on all the risk of a lump-sum investment, there’s a balanced middle-ground approach.

Suppose your goal is to be fully invested in stocks. Instead of going all in at once, start with 50% in stocks and 50% in a lower-risk fund. This way, your entire portfolio is invested from day one, but with a smoother entry into full equity exposure.

Example:

• Day 1: Invest 50% in stocks (for instance, VTI or VOO) and 50% in a balanced or allocation fund (such as PRWCX, FBALX, or FEVIX).
• Each month: Sell 20% of the allocation fund (equal to 10% of your total portfolio) and move that amount into VTI or VOO.
• After six months: You’ll be fully invested in stocks.

This method offers flexibility — you can adapt it as needed. For example, start with 50% stocks and 50% bonds, then transition gradually over time based on market conditions or comfort with risk.

 

[FD1000]

So, who's buying today?

I'm invested at 99+%, which is why I don't have cash.

 

[Steelpony]

Did anyone ever try to hoard their cash and market time say buying etfs, not stocks, instead of DCA every 2 weeks? I tend to send things to DCA because i'm auto-investor. But a friend who lives super frugally (banks one salary and lives on other), hoards the cash and tries to only buy etfs on the dips.

Anyone here ever did that analysis if it works out better? Not betting on stock too much variable. But going "hmm the market pulled 5-10% now to buy VTI". That's what she said she does. She only buys when it goes down and hoards cash the rest of the time.

DCA probably is easier and more efficient long term. Besides being automated highs and lows flatten out long term.

The prime reason market timing doesn’t work as well especially in the short term is one needs to be right twice, when to get in and when to get out. It requires a hands on human element prone to emotional decisions.

 

[pjigar]

Today was an excellent day to buy the TACO dip, but I've exhausted all my free cash for now...

I wish but just bought a tractor this morning! I also did rebalancing two days ago (sold a day before, bought yesterday). All cash used up now.

 

[TheWizard]

I wish but just bought a tractor this morning! I also did rebalancing two days ago (sold day before, bought yesterday). All cash used up now.

A tractor?
Neato!
I hope it was one of those 4WD models with double wheels on both ends!!

 

[pjigar]

A tractor?
Neato!
I hope it was one of those 4WD models with double wheels on both ends!!

I wish. I don't have that much land to use anything heavy duty. But yes, it's a Kubota L3560 with a cab (AC/heat) HST 4WD. I have the exact same one (2009 L3540) without a cab and it's been leaking a little so BTD!

 

[Quattro73]

Right back to where we were to begin September. Not sure there is a dip to buy yet.

 

[Koolau]

A tractor?
Neato!
I hope it was one of those 4WD models with double wheels on both ends!!View attachment 59096

Woah! I'll bet that's tough to get in and around the bushes!