Crossposted from https://lemmy.ml/post/48918911

The irritating DCA thing is just a manipulation from bankers , stimulating the worst possible gamblers mistake - chasing losses. DCA claims it averages cost of participation, but that is a pure fallacy: these are independent events and probability of winning does not increasing with each “entry” even a cheaper one. What bankers are proposing to you is that you play again to cover previous losses. But the next play has the same probability to losing as the first one .

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    27 days ago

    I think the term came specifically from the problem “what to do with a windfall?” Since a diversified portfolio of conventional assets will tend to grow, the theoretical optimum is to invest it all today, but if there is a stock market crash or a spike in interest rates tomorrow this can lead to regrets. If you have trouble with this, a common strategy is to commit to investing 10-20% a month so you will get some high prices and some low prices. The same if you inherit some shares which are too much of your net worth and are worried about selling them before the price rises or keeping them until the price crashes: commit to selling a certain amount once per week or month and follow that. In casual language it gets conflated with the principle that a regular schedule of saving and investing is better than waiting until you get a raise or find the ‘right time’ to buy in.

    I think the OP thought he understood this concept from reading Internet posts on crypto spaces and a better way to learn is a book or at least a blog by a trained and certified professional.