Quote:
Originally Posted by Stu from NYC
How do you know if this is the bottom or what the market will do over say the next 5 years. If this is the bottom your strategy does not work.
That is why dollar cost averaging is a good idea for the smaller investor.
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Dollar cost averaging is a good strategy, but I think it works best when it is done for both buying and selling stocks. You buy stocks on a regular basis over a long period of time, the accumulation phase. Then, you hold the stocks for a long period of time. Then, you sell the stocks on a regular basis over a long period of time, the liquidation phase. Most people in retirement should be in the liquidation phase for their stocks.