18 Apr 2019
Why or why not?
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14 Apr 2019
Business Student at Ntu
Richard answered this quite well. But if u wanna do dca, u may consider a unit trust (infinity us 500) with a platform that has 0% transaction fee. Do know that unit trust has their management/expense ratio etc and costs, so they got their pros and cons
Unless you are planning to DCA a relatively large amount, you would be making it difficult for your investments to turn a profit. This is due to the transaction costs involved in local brokerages, usually average at about $25 per transaction. So, if you only put in $200 per month, you are asking your investments to return slightly above 10%, just to break even!
Unless you are dollar cost averaging perhaps in the 1-2 thousands per 2-3 months, that would allow you to mitigate the transaction costs eating away your profits. There's also the problem of odd lots as well, since you may not be able to invest all the money due to fluctuations in ETF stock price. So the best idea is actually to invest one lump sum if you don't have much money. If you have quite a sum maybe 50 thousand, and you're able to DCA a thousand, 2.5% to break even still isn't too bad, but it still eats the profits from you.
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