Comments on: Dollar Cost Averaging – Episode #27 http://www.thewaytobuildwealth.org/2008/12/dollar-cost-averaging-episode-27/ Ethan Bloch shares wealth building hacks, tips and wisdom discovered from the world's greatest minds. Wed, 07 Jul 2010 00:17:25 -0700 http://wordpress.org/?v=2.8.4 hourly 1 By: ethan http://www.thewaytobuildwealth.org/2008/12/dollar-cost-averaging-episode-27/comment-page-1/#comment-69 ethan Thu, 18 Dec 2008 06:59:26 +0000 http://www.thewaytobuildwealth.org/?p=319#comment-69 Hey Thai, thanks for bringing up a worthy alternative to DCA. The major thing I don't like about DVA is that to properly execute it, you need decide on a target portfolio value i.e. total amount of money you want to end up with or a target amount to increase your investment by each investing period.<br><br>If one feels confident and is up to that task, more power to them. For many this presents potential pitfalls.<br><br>In tomorrows episode I do mention a much less eloquent way to take advantage of market lows when using a DCA approach, and that is just buying a crap ton more at known lows then would be usual in your DCA plan.<br><br>The other thing that bothers me with DVA is if you follow it strictly, in some months, large ups in the market will force you to take money out. Exposing you to taxes and the such. DVA is really is an a much more active approach towards investing then the passive DCA.<br><br>Like most articles say (here is a good one: <a href="http://www.investopedia.com/articles/stocks/07/DCAvsVA.asp" rel="nofollow">http://www.investopedia.com/articles/stocks/07/...</a>), it is really up to you and your temperament. For the typical person I believe DCA is a better choice.<br><br>Thanks for adding a worthy addition to this episode through you comment!<br><br>Cheers.<br><br>Ethan Hey Thai, thanks for bringing up a worthy alternative to DCA. The major thing I don't like about DVA is that to properly execute it, you need decide on a target portfolio value i.e. total amount of money you want to end up with or a target amount to increase your investment by each investing period.

If one feels confident and is up to that task, more power to them. For many this presents potential pitfalls.

In tomorrows episode I do mention a much less eloquent way to take advantage of market lows when using a DCA approach, and that is just buying a crap ton more at known lows then would be usual in your DCA plan.

The other thing that bothers me with DVA is if you follow it strictly, in some months, large ups in the market will force you to take money out. Exposing you to taxes and the such. DVA is really is an a much more active approach towards investing then the passive DCA.

Like most articles say (here is a good one: http://www.investopedia.com/articles/stocks/07/...), it is really up to you and your temperament. For the typical person I believe DCA is a better choice.

Thanks for adding a worthy addition to this episode through you comment!

Cheers.

Ethan

]]> By: Thai http://www.thewaytobuildwealth.org/2008/12/dollar-cost-averaging-episode-27/comment-page-1/#comment-68 Thai Wed, 17 Dec 2008 20:35:22 +0000 http://www.thewaytobuildwealth.org/?p=319#comment-68 Do you (or anyone else) have any thoughts on Dollar Value Averaging? From what I've read, it is an optimized version of DCA, but with a tad more work involved. Do you (or anyone else) have any thoughts on Dollar Value Averaging? From what I've read, it is an optimized version of DCA, but with a tad more work involved.

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