QUOTE(howszat @ Dec 28 2018, 10:37 PM)
No, it's not the best way. It can even be a really lousy way.
For Cost Averaging to be profitable, it depends on the average-cost in future to be higher than the average-cost today.
Or put it another way, if you look at the fund performance chart, it should trend upwards over time, given a few up/down blip every now and then, but the general trend should be upwards.
But many funds do not achieve this. Quite a number are negative over time, and others barely keep their head above water, on average. Hence, the common impression that the return is around FD or worse.
When fund agents (and even fund houses) tell you about cost-averaging, they "forgot" to tell you about this particular point - the fund MUST trend upwards over time.
To demonstrate, from the old FSM performance 5-year table, 111 funds are 0-4% returns, and 75 are NEGATIVE returns. Cost averaging is not going to help in these cases.
I haven't come across where the new FSM tables are, but in general, the new website is a backward step.
Just to summarize, is the following method a better way to perform dollar cost averaging (DCA), in general for any unit trusts?
1) Downtrend in NAV is anticipated over the next few months.
- Completely stop DCA. Deploy the fund (meant for DCA) for e-fixed deposit, or in money market.
2) Downtrend severity in NAV starts to reduce (NAV price curve starts to reduce and gradually flattens), with the possibility of NAV rebound within the next month (economy may start to be better)
- Perform DCA with partial fund.
3) NAV starts to rebound, with uptrend in NAV expected within the next few months.
- Perform DCA, with full intended fund every month.
Is my understanding correct, about the proper way to perform DCA? Appreciate a few tips, from FundSuperMart expert inventors here.
This post has been edited by kart: Dec 29 2018, 08:01 PM 
Dec 11 2017, 10:50 PM
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