I understand DCA. Personally I don't use DCA on my own portfolio because I have a set parameter to enter and exit.

DCA is a very good mechanism for those who do not possess the technical know how to enter and exit a investment position.

However, no matter what way you use, academic studies shows that up to 90% of the excess return from market is through proper asset allocation, not timing the market.

So, you are better off doing proper asset allocation than to time the market.

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1. NAV is irrelevant to my decision making when making an entry or exit of a fund.

2. I have written this before, the parameters that are important to me for choosing a fund are:
i) Its ROI, its standard deviation, its correlation with its benchmark, its beta wrt the benchmark.

ii) My entry point is when the fund benchmark hits the bottom of bollinger band or RSI is oversold or when Fast Moving MA cross the Slow Moving MA.

iii) My exit point is when I need the money. I.e., when I am 65 or 70 y/o and no longer have an active income.

JPB, I know my decision wrt the fast moving MA is reverse than the prescribed method because I am looking at accumulating dividend type stocks. I want to buy them when their price is low so that the D/Y is high.

If you are chasing capital gain, then the reverse is true, because you want to ride on the wave.

On the other hand:

There is an easy way, very easy way to make sure you buy low; sell high.

Set a fix ratio btw bond and equities. One easy way is to take 100 - your current age (e.g. 35 y/o) Hence it is 65% equities: 35% bond.

Do DCA onto those asset class according to the ratio. Should the market move up and your ratio change from 65:35 to say 70:30; then sell your equities portion to buy into bond to maintain 65:35 equilibrium. This way you will always sell high, buy low.

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