Is Dollar-Cost Averaging Better Than Lump-Sum Investing?

Dollar-cost averaging is breaking up a sum of money into the same amounts and consistently investing them over time. Lump-sum investing is the immediate investment into a security using all available funds. So which approach may be best?

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[hollyjames]

Excellent! I’ll use this for my beginners investment group meeting. Thank much

[inertiaforce]

This only compares once per year investing to once per month investing. It does not compare an entire lump sum invested all at once and held for a 20-year period to a dollar cost averaging over a 20-year period.

[TheBrettMizer]

But with the S&P 500 earning 10% per year over the last 50 years or so. You could still make out a head in the long run. It might not be effective for short-term investing.