Dollar Cost Averaging (DCA) 101

Most of the brightest minds in investing do agree on one thing: DCA as an investment strategy. 

Markets are messy. You never know when the index is going to shoot or fall. The biggest question has always been ‘when’ to invest. This is equivalent to finding the right age for getting married, wherein, you are almost, always wrong. But there’s method to this madness in finance.

DCA is a simple strategy which asks you to split your amounts across regular periodic purchases. The objective is to remove the complexities around timing and external factors. For e.g., if you wish to invest INR20,000, you can divide that money across 20 months (your choice) and invest 1K every month. Recurring deposits, SIPs, Voyager (for crypto) are just some ways to do this. DCA + compounding = strategy to adopt. Easy, right? 

You can DM me to understand Kelly’s criterion and how does it work. But, frankly, who cares? Stress related to investing leads to hair fall, so choose other methods carefully. 

Thanks!