How do I dollar cost average into stocks for long term?

[andrianov]

Usually quality stocks like AAPL,FB,TWTR won't fall much. I cant see AAPL price 50$
When we are taking reference 2009 crash. Financial stocks fell 95%, quality stocks 50% not much. Now "financial stocks" are MAR,RCL etc. I think its time to trigger first bullet for sure. I would buy AAPL 220 and next portion every 5% drawback

 

[risktaker]

Usually quality stocks like AAPL,FB,TWTR won't fall much. I cant see AAPL price 50$
When we are taking reference 2009 crash. Financial stocks fell 95%, quality stocks 50% not much. Now "financial stocks" are MAR,RCL etc. I think its time to trigger first bullet for sure. I would buy AAPL 220 and next portion every 5% drawback

So the "quality stocks" are supposed to go to the moon?
That's mistake #1.
Keep studying because you'll eventually realize mistakes #2 and #3.

 

[ElCubano]

Buy in time inetervals, not chart intervals. Buy a set amount every x days. Do not buy higher than your cost avg point. If the day you need to buy is higher than your avg cost you skip that date. That’s what I’ve been doing. Every week x $ spy, qqq, msft and some roku. Good luck. No more roku or softie for me. Just qqq spy

 

[ironchef]

Buy in time inetervals, not chart intervals. Buy a set amount every x days. Do not buy higher than your cost avg point. If the day you need to buy is higher than your avg cost you skip that date. That’s what I’ve been doing. Every week x $ spy, qqq, msft and some roku. Good luck. No more roku or softie for me. Just qqq spy

I ran a backtest on SPY a few years back, using your model (ignored commissions), did get better returns than the benchmark's long term rate. The answer was different when I added commission costs. In today's zero commission world, it is a winner.

 

[SimpleMeLike]

Do not buy higher than your cost avg point. If the day you need to buy is higher than your avg cost you skip that date.

Thank you ElCubano,

Yes, after a bit of research I agree on the time interavals. Because noones knows a bottom of stock price.

For example, with $10K and stock A.

I will do the following.

1. Divide $10K by 3,lets call it. $3500
2. Every Friday for the next 3 weeks, I will buy $3500 worth of stock A shares.
3. Done and then wait.

I think this will help relieve stress and emotions of having a logically plan.

 

[ironchef]

Thank you ElCubano,

Yes, after a bit of research I agree on the time interavals. Because noones knows a bottom of stock price.

For example, with $10K and stock A.

I will do the following.

1. Divide $10K by 3,lets call it. $3500
2. Every Friday for the next 3 weeks, I will buy $3500 worth of stock A shares.
3. Done and then wait.

I think this will help relieve stress and emotions of having a logically plan.

Better off divided into 10-12 chunks instead of 3. 3 is not diversified enough. 10-12 you are approaching diversity.

 

[SimpleMeLike]

Better off divided into 10-12 chunks instead of 3. 3 is not diversified enough. 10-12 you are approaching diversity.

Hello ironchef,

Thanks for comments.

Are you suggesting take the $10K and divide by 10, $1000. Then invest $1000 periodically ($1000 per week) in stock A?