DCA is for people that have made POOR INVESTMENTS and want to justify it to themselves. Some will say that "i am dollar cost averaging" and others will just go shoot themselves. Both pretty similar except the person DCA will continue to make bad decisions in other parts of their lives. Those that DCA tend to be drinkers that gamble (sometimes) on pokies and bet on horses .
I'm not following the logic here. If the price of silver goes sideways you're not dollar cost averaging you're just buying at the same price. If the price of silver drop and you buy more then you're lowing your average cost which is how it's supposed to work.
:lol: Whoa! While I agree DCA is an absolute mugs game, I'm not sure I'd go that far with my assumptions. :lol: DCA is for those that don't know any better, or can't do any better ---- then again, for many poor souls, so is PM investment, so it would seem quite fitting.
MY DCA is just under AUD$18 silver per ounce and just on $40 per gram for gold........tell me again how I am doing it wrong....... Disclaimer - dont play pokies (seriously how boring), last drink I had was New Years Eve 2014/15 and dont bet on horses except Melb Cup.
There are always statistical outliers... An average of $18 and a spot of $19..... tell me how long you've been DCAing for and I might be able to give you a hint.
I've also been buying more than a year and have my non-premium adjusted DCA at around $19 and a little change. If buying low is doing it wrong I must have missed something pretty fundamental.
Firstly, you are absolutely correct - all true costs should be factored in - including lost opportunity cost. This a cost many chose to ignore, but that is another topic. As for DCA over 14 months... not really a good measure yet. Time will tell. Now, for a logical argument against DCA (taken from this thread - http://forums.silverstackers.com/message-518674.html#p518674:
I took a slightly different approach to DCA. I'm an active seller/buyer so If I spot good deals I made some purchases and when premiums increased, I sold. Then when premiums dropped again or some specials, purchased. This type of buying and selling has allowed me to set my stack at ~550oz @ $15.19/oz after all sales included minus fees. This includes several premium items as well and all physical. When I eventually sell the premium stuff, that DCA will continue to move downward. That being said, DCA for the last 5 years is pretty futile. If you just saved for 5 years and bought lump sum now, you'd have a lot more metal. DCA shows its advantage when it starts moving up, but that has yet to materialize. Continuing to DCA by buying only is still risky and as mentioned deferred risk since there's no bottom in sight. You don't spend it all at one time and spread the risk, but when the direction is down. You still end up down, until it starts going up again.
DCA is perfectly sensible when viewed as a means of introducing emotional distance in buying decisions. If you decide to put $100 a week into PMs, you are running DCA as a minor discipline that excludes 'back the truck up' and 'too dear' thought processes (which is where the gambler mentality can strike). If you don't think you getting value, revisit your investment plan. It's ideal for people with real-world incomes and expenses, and a simple way to avoid living off chips for a week, or running the credit card hot. Not a good plan for a trader; not a good plan for a collector. It would be interesting to see the return (positive or negative) for putting $100 a week into non-numismatic coins, or unallocated silver.
Yes. It is merely a fancy marketing pitch for a savings plan, and is inefficient as an investment strategy.... the mathematics doesn't lie.
Meh, Im happy going through life wearing the mantle of "Statistical Outlier" Although I see arguments against DCA I havent seen anyone propose an alternative which I would very much be interested in hearing.
Me too! Really it just depends on the style of collecting/stacking/flipping etc. I've done the hoarding thing and learned you have to hoard the right thing but even that can change. However active hedging has been working out the few months I've been buying.. I also keep a spreadsheet of what I buy and sell to manage my DCA. There's a simple DCA and a little more complicated DCA. Sounds like we're using the more complicated way.
