Does Dollar Cost Averaging really work?
Dollar Cost Averaging consists of investing regular fixed amounts of monies in a fund at regular intervals and is a strategy designed to lower the average entry price and reduce the effects of volatility. This strategy has been mainly championed by investment fund managers and mutual funds and is a technique promoted by institutions to keep people invested. The problem with this strategy is that it has been proven flawed, not to mention that transaction costs increase when dealing with multiple smaller transactions (as opposed to one lump sum). This is the same dollar cost averaging strategy endorsed by Rory Gillen…