Does Market Timing Work?
comentada em 05/03/2024 19:41

Consider dollar-cost averaging as a compromise

If you don't have the opportunity, or stomach, to invest your lump sum all at once, consider investing smaller amounts more frequently. As long as you stick with it, dollar-cost averaging can offer several potential benefits:
Prevents procrastination. Some of us just have a hard time getting started. We know we should be investing, but we never quite get around to it. Much like a regular 401(k) payroll deduction, dollar-cost averaging helps force yourself to invest consistently.
Minimizes regret. Even the most even-tempered stock trader feels at least a tinge of regret when an investment proves to be poorly timed. Worse, such regret may cause you to disrupt your investment strategy in an attempt to make up for your setback. Dollar-cost averaging can help minimize this regret because you make multiple investments, none of them particularly large.
Avoids market timing. Dollar-cost averaging ensures that you will participate in the stock market regardless of current conditions. While this will not guarantee a profit or protect against a loss in a declining market, it will eliminate the temptation to try market-timing strategies that rarely succeed.

Charles Schwab