not always, but in 5 to 6 years of a bull market, then yes lump sum will win. If it goes to a bear market then your lump sum will have lost less.

Say I have 1 lumpsum I know for the next 5 years I confirm won't use it.

Should I just dump in all in once? If DCA, the amount the come in later in the DCA strategy seem to frogo the returns in the market. Dumping in 1 shot ensure the full amount of lumpsum get to stick in there market longest time

Kinda begs the question should I DCA over 5 years or dump all and forget, come back to see after 5 years

This post has been edited by littlegamer: Feb 6 2021, 06:22 PM

If having difficulty to choose lump sum or DCA, then 50% lump sum, 50% DCA.

This saves your time to think, and for sure give the average result, not best or worst which might makes you regret later.

IMO lump sum easier if you put it into a diversified portfolio like stashaway

Can always lump sum your RM100k into Stashaway Simple then DCA a certain amount weekly into portfolio until target meet too if don't wanna hold the cash and rot while waiting to DCA it too I guess?

As some have already pointed it out, lump sum investing in most cases outperform DCA, with enough time in market. I think someone posted some research a few pages back, can go look it up.

Do you mean like having 22 26 30 36 distributed across them?

My situation now is I know I'm not getting married, buying a car or house. Say this lumpsum today is gone crash and burn. My current employment with frugal saving can recoup this amount in 2 years time.

My thoughts are, Yolo this lumpsum I have (keep 6 month emergency fund), from today till next 5 years, save up this amount, and contribute say a smaller sum each month (lumpsum +smaller dca), and the leftover I keep somewhere like FD.

Assuming within this 5 years, there is a crash, the FD can be instantly use to buy the low. Therefore offset the drop.


I really have no idea what I should do or am I overthinking. I just don't want my cash get eaten away from inflation.

Before I got all over the place.
Example,

Now dump 100k in stashaway. Each month I normally contribute 2k,but instead I dca 1k, the other 1k keep in FD. Continue dca 1k to SA monthly, 1k the FD. When crash, FD to SA to call buy the dip.

Advantage I can think of
1. My current lumpsum get to stay in market the longest time
2. Still get to DCA, but amount reduce to halves ,thr DCA amount can still get the gains in the market
3. Should it crash, my FD that I set aside should be able to boost back the lost.

Disadvantage
1. It be Hella scary having 100k drop 20 30%.
2. In case some thing in life happen needed cash, I will have very little Liquidity
3. I have to boost my income in order to keep the investment aggressive.

Personally think that this 6 months emergency savings can go into less risky vehicle like FD. I would not recommend dumping all your emergency savings into higher risk investment. If your investment strategy may cause you to be stressed out or emotional about it, I dont think you should be following it.

In any case, maybe 3 months of savings can suffice for now, depending on your dependents and situation, and you can go ahead and put those in high interest savings acc , and then the other 3 months into SA or other higher risk investments.

The thing about buying the dip? If you already know when to do so, I dont think you'll need to be asking in thread anyway.

What I mean is the 6month emergency is already set aside. This 6month fun is nothing to do with stashaway, it will always be in Fd like a break glass if shit goes south kinda piggy bank.

Regarding the dip, no one can predict. But I'm thinking if there is a dip then I will have some amount ready.

Out of curiosity if you don't mind, are you investing anywhere else?
Are you comfortable with all 100k dumped into a platform you haven't tried much with?
Are you really sure that you won't be tempted to check twice a day before and after sleep?
And when that 100k turned into 70k you won't panic sell?

100k to 70k, if I am on 36% risk level, there is a good chance it will bounce back, I will sell my myvi to go all in.

StashAway is considered more risk conscious vs other robo advisors in this region already, so yes, I feel safer leaving my money with them than my own picks.

Officially 6 months with SA
Slowly building up the "stairs" by putting in 150 every 2 weeks, DCA so i can sleep well at night
Still deciding whether or not to increase the DCA amount since I got increment



This post has been edited by cr7jyej: Feb 6 2021, 10:12 PM

i think not need to debate either lump sum is better or DCA is better....

every body got their point.....no right n wrong.....

wanna lump sum os can.....as long as u dun panic sell if it suddenly dip n u loss 10% or 20% or 30%......let it come back to rally, no matter how long u wait.....may b 5 year, 10 year , 15 year or even longer time frame....

wanna DCA oso can.....as long as u happy with ur method......dun regret if ur profit can fight with the ppl that lump sum.....

choose the method that suit u and u can sleep well every night , n happy too.....

16% risk portfolio since September 2020 (will be withdrawing this after two years so I'm not using higher risk)

Not bad performance for MYR. Pity because of strengthening MYR, my actual profit is low if in USD it's been only +ve growth since November 2020

This post has been edited by DragonReine: Feb 6 2021, 10:40 PM

Ideally we shouldn't panic sell.

But I did take a big portion out in Feb 2020, when the market started dipping because the writing was on the wall at the time (hey don't judge me I'm just human ).

I didn't lose money, but I also missed the buying the dip. Huhu. I think it comes down to your risk appetite, if cannot deal with a 30% loss, then maybe should lower the risk.

https://ofdollarsanddata.com/dollar-cost-av...ng-vs-lump-sum/

Well, I guess all good then. The problem with the dip is, you do not know how low the dip is, but then again, it's moot if you're using funds that are very much disposable, you prolly wont get panic if it ever drops and cut your losses on a frenzy.

My one not performing quite while compare to others, maybe due to risk lower i guess

This is a good read. Thank you

Net profit 15% is damn good