Does it matter when you buy in for IWDA ETFs (quarterly DCA) if planning to hold long? - Seedly
Seedly logo
Seedly logo
 

Investments

ETF

Online Brokerages

Anonymous

Asked on 25 Jul 2020

Does it matter when you buy in for IWDA ETFs (quarterly DCA) if planning to hold long?

0 comments

2 answers

Answer Now

Answers (2)

Sort By

X
X_Y
Level 5. Genius
Updated on 26 Jul 2020

Agree with Frankie Rappaport. If you are planning to hold for long, it's important to smooth out your portfolio volatility by buying in at different price points and periods. People who enter a large lump sum at once are those who are trying to time the market. If they are right, they reaped in profits quickly, and if they are wrong they lose everything quickly too. Not to mention also the psychological roller coaster for years.

If you are doing quarterly DCA, I can help you out a little to improve your approach.

IWDA LN:

-There are 44 quarters worth of data in this fund (incepted in 2009)

-34 quarters are positive (including current quarter) - 77.27% of total quarters

-10 quarters are negative - 22.73% of total quarters

By calculating the probabilities of both funds using their full historical data, you know that the odds are stack in your favour by DCA-ing gradually. Stick to a fixed amount within the green (upper) and red (lower) dotted bands. They are the average (+) and (-) returns and represent "normal times". When the price drops below the lower band, increase your DCA amount because such times are rare, and you need to take advantage of it knowing the odds are still favouring the upside. When it goes above the upper band reduce your DCA amount because it's hinting you based on the full historical data, price is overextended and most probably is going to revert back downwards. A useful strategy to use on an up-trending counter. Hope it helps.

You can get more charts of this fund over here: https://dl.orangedox.com/fund-analysis-pdfs

File Name: ISHARES CORE MSCI WORLD (IWDA LN Equity)_updated_260720​​​

2 comments

👍
0
Question Poster

26 Jul 2020

Thank You!
James ng

30 Jul 2020

The problem is that no brokerage allow monthly DCA to London stock exchange. The minimum fee is usually S$10++ so one should only invest with at least $5000 to $7000 each time.
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post
Frankie Rappaport
Frankie Rappaport
Top Contributor

Top Contributor (Aug)

Level 9. God of Wisdom
Answered on 25 Jul 2020

1 comment

👍
0
Question Poster

26 Jul 2020

Thank You!
Thank You!
Can you clarify
I wonder if
This is so helpful 👍
What about
Post