My investment is light on stocks. I have a lump sum amount of cash that I want to invest in the market. I am thinking of dollar cost average it monthly into the market over the course of 5 years.
My thinking is that if the market goes bad, within the span of 5 years I should at least be able to catch some of the bottom. If the market continues to goes up, then I'll make some money. The worst case scenario is the market stays flat for 5 years than crash. In that case I get screwed.
Some say if you just put the money all in now, statistically you will come out ahead of dollar cost averaging. My thinking is that I may lose some opportunity for gain, but I get some protection from a steep drop.
Is there something wrong with this strategy?
FYI. All this money if for long term. Hopefully I can hold it for 20+ years. At the most I'll just tap into the dividend.
My thinking is that if the market goes bad, within the span of 5 years I should at least be able to catch some of the bottom. If the market continues to goes up, then I'll make some money. The worst case scenario is the market stays flat for 5 years than crash. In that case I get screwed.
Some say if you just put the money all in now, statistically you will come out ahead of dollar cost averaging. My thinking is that I may lose some opportunity for gain, but I get some protection from a steep drop.
Is there something wrong with this strategy?
FYI. All this money if for long term. Hopefully I can hold it for 20+ years. At the most I'll just tap into the dividend.