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TMFMycroft:

I am simply stating that Dollar Cost Averaging works and I am a living example of that as are millions of others.

You are not a living example of anything if you can't substantiate your self-proclaimed success. The public records from these boards and Yahoo regarding your recent major investments since 1998 or so (Coca-Cola and Nokia) suggest that you are living anecdotal evidence that Fisher, the rule maker principles, or any strategy that ignores valuation is doomed. You have lost money on Coca-cola during the time of your public record and as far as I can tell dollar cost averaging has not helped. If I'm not mistaken Nokia right now trades close to its price when you first declared your bullishness. In the meantime NOK has spend considerable time at much higher prices. Therefore, dollar cost averaging has worked directly against you (if you had followed that strategy) leaving you with a paper loss.

If you need to buy a stock then buy it now. Dollar cost averaging has the beneficial effect of lowering the variance of your average purchase price (smoothing out highs and lows) but the effect comes at a cost. If you believe that NOK will return 15% per year on average compared to money market rates of 5% then dollar cost averaging costs you 10% per year. Dollar cost averaging implies that your subsequent buys on average occur at higher and higher prices.

Datasnooper.
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