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Old 04-26-2007, 03:12 PM
Perplexity Perplexity is offline
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Join Date: Jul 2006
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Default Re: Comments on Vanguard Portfolio Plan

[ QUOTE ]
It is beyond question horrible advice to jump-start with 100% of your investable assets all hitting the market on Day 1, for curtains. Anyone who says otherwise is an idiot.

No rational [or professional] investor does this. Essentially, you are saying that, using SPX as an example, it is OPTIMAL to put 100% of your funds in on Day 1. It will never go down more than a tiny bit, the optimal solution is all of it, now.
After all, the SPX has underperformed bonds for 8 years now.

Since we know the market will have a tumble of that size, it is more optimal to invest some/most now and the rest later.
Or DCA over 3, 6, etc months, whichever you prefer.

You seem to lack a basic understanding on these issues you are giving advice on.

[/ QUOTE ]

This is wrong. Dollar cost averaging is the suck.

You can google around for numerous articles about this.

Here's a particularly good one:

http://www.rmi.gsu.edu/FSR/abstracts/Vol2_1/v2-1a4.pdf
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