Paste the prices you bought at — or the ones you plan to — and see the average cost a fixed-amount schedule actually produces, next to the plain average of those prices.
A fixed cash amount buys more units when price is low and fewer when it is high, so the resulting average cost is a harmonic mean rather than an arithmetic one — and the harmonic mean is always lower. In the default example, five $250 buys at 100, 80, 60, 90 and 120 give an average cost well below the 90 arithmetic average of those prices.
It is not a return-maximising strategy. Studies of lump-sum versus staged investing generally favour lump sum in markets that drift upward, because time in the market beats averaging into it. DCA buys something else: it removes the single largest behavioural failure — putting everything in at a high and nothing in at a low — and converts a timing decision into a schedule you can keep.
Fix the amount and the interval in advance, write them down, and do not adjust the size based on how you feel about the last candle. A schedule that changes with sentiment is discretionary trading wearing a process costume.
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On average, and in trending markets, lump sum has historically produced higher returns. DCA reduces the impact of a single bad entry and makes the plan easier to follow, which is why it persists.
Any fixed one you will actually keep. Weekly and monthly are common; the interval matters far less than not abandoning it during a drawdown.
Yes — selling a fixed amount on a schedule smooths exit price the same way, and removes the need to call a top.
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