Anonymous
DCA vs Lump Sum for S&P500 - which should I go for amidst this COVID-19 pandemic?
I am thinking of putting my first $10k into kristal.AI's S&P500, since there are no fees for the first $50k of investments. There are two indexes that I am looking at:
- CSPX (minimum investment of $4.3k)
- IVV (min. $357)
If I do CSPX (Irish domiciled, 15% tax on dividends), I can only DCA two times, while I will be able to DCA over a longer time horizon for IVV - but I would be subject to the 30% tax on dividends.
Which should I be going for amidst this COVID19 pandemic?
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Lump sum wins 90% of the time. DCA is a strategy used for psychological and emotional control, not a strategy for better returns.
If you're able to stay logical and insane, lump sum is statiscally a better strategy. DCA works for most people because it is easier to stick too and not panic.
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I think at where the market is right now! DCA is the best option since it will take a while for the ...
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Hi there,
DCA/ SIP (Systematic Investment Plan) is the preferred strategy when there is heightened volatility in the markets.
Hope this helps,
Cynthia