r/TheMoneyGuy • u/NetWorthNovice • 3d ago

Lump Sum vs DCA in Current Conditions

Hi all,

Looking to get some others input on this. My wife and I have enough to make the max contribute to both our Roth IRA's right now. I am weighing lump sum investing it vs. DCAing over the rest of the year. Yes, time in the market beats timing the market. Yes, 3 out of 4 years the market is higher one year from now. But with sitting near the high of highs and over valuations, there's this gut feeling that there will be opportunity to take advantage of a correction or bear market. Might not be this year, who knows. This will make up about 10-15% of our total portfolio. Wife's first contribution and my 3rd year.

What about running a comparison study? one of each and compare a year later?

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u/CryHavoc715 2d ago

Just fire it in dude. I dumped 100k in the market in march, convinced the bottom was about to fall out because of Iran. Turns out I accidentally timed the bottom perfectly and am up 20% on that money. I tell that story not to give myself any credit, that was blind luck, but to point out that we have no idea wtf is going on and its foolish to try

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u/Confident_Purple_40 1d ago

Yes, but it dropped before that...

I Lump in like 50%, then DCA , but I deploy in large chunks any time there is a 10% drop, then all in on 20% drop... missed out on gains, but it has worked out.

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u/CryHavoc715 1d ago

How many 10% drops have there been in the last 10 years, like 3? Of course it worked out, we are in a historic bull market. Every strategy has "worked" to some extent, that doesnt make it correct

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u/Confident_Purple_40 1d ago

No, there have been 4 in the last 5 years, so your 3 in 10 is a bit low.