WEBVTT 00:00:00.000 --> 00:00:01.560 Welcome back to The Deep Dive. We're the show 00:00:01.560 --> 00:00:04.660 that digs into your sources to really get to 00:00:04.660 --> 00:00:06.179 the heart of what you need to know. We're here 00:00:06.179 --> 00:00:08.400 to make sure that time you spend listening gives 00:00:08.400 --> 00:00:12.859 you the absolute best return. Today, we are tackling 00:00:12.859 --> 00:00:15.919 a huge one. A really huge one. It's a concept 00:00:15.919 --> 00:00:18.699 that's fundamental to building wealth over the 00:00:18.699 --> 00:00:21.760 long haul. But it's also, I would argue, the 00:00:21.760 --> 00:00:24.780 single most misused and misunderstood term in 00:00:24.780 --> 00:00:26.920 all of personal finance. We are talking about 00:00:26.920 --> 00:00:29.600 dollar cost averaging. We are. OK, so before 00:00:29.600 --> 00:00:32.000 we dive into the weeds, you know, the definitions, 00:00:32.039 --> 00:00:35.399 the controversy, let's just ground this conversation 00:00:35.399 --> 00:00:38.039 and the sheer power of being consistent. Yeah, 00:00:38.100 --> 00:00:40.520 the end goal. Exactly. Our source material kicks 00:00:40.520 --> 00:00:43.320 off with this really stunning hypothetical. It 00:00:43.320 --> 00:00:45.859 just perfectly sets the stage. Imagine you decide, 00:00:46.039 --> 00:00:48.200 okay, I'm going to invest $500 a month. Which 00:00:48.200 --> 00:00:50.079 is what, a car payment for some people? Or less. 00:00:50.219 --> 00:00:52.899 Could be a coffee budget. But you do it every 00:00:52.899 --> 00:00:56.659 single month automatically for 40 years. And 00:00:56.659 --> 00:00:59.560 you get a, let's say, a pretty reasonable 10 00:00:59.560 --> 00:01:02.460 % average annual return. Which is right in line 00:01:02.460 --> 00:01:04.719 with historical averages. Right. At the end of 00:01:04.719 --> 00:01:07.500 those 40 years, your balance would be... Over 00:01:07.500 --> 00:01:10.500 $2 .5 million. It's an incredible number. And 00:01:10.500 --> 00:01:12.859 that's the thing to remember. That $2 .5 million, 00:01:13.060 --> 00:01:15.879 it's not from some lucky stock pick. It's not 00:01:15.879 --> 00:01:18.819 about timing the market perfectly. It's a monument 00:01:18.819 --> 00:01:22.640 to a habit. It's just automated, consistent behavior. 00:01:23.120 --> 00:01:26.620 So the real question for any regular person saving 00:01:26.620 --> 00:01:29.340 for the future is how? How do you do it? How 00:01:29.340 --> 00:01:32.739 do you actually execute that $500 a month investment 00:01:32.739 --> 00:01:36.359 in the smartest way possible and... Critically, 00:01:36.480 --> 00:01:39.260 how do you maintain the discipline to do it for 00:01:39.260 --> 00:01:42.060 decades? That's the key. And the name for that 00:01:42.060 --> 00:01:45.840 method, dollar cost averaging, or DCA, you hear 00:01:45.840 --> 00:01:47.900 it everywhere. I mean, your 401k, your pension 00:01:47.900 --> 00:01:51.040 plan, it probably uses this exact strategy. It 00:01:51.040 --> 00:01:53.420 almost certainly does. But what we found digging 00:01:53.420 --> 00:01:55.939 into the original sources is that this term, 00:01:56.019 --> 00:01:59.159 this thing that's so widely debated, has been, 00:01:59.159 --> 00:02:01.000 well, it's been hijacked. It's been completely 00:02:01.000 --> 00:02:03.500 misinterpreted. And often by the very industry 00:02:03.500 --> 00:02:05.879 that's selling you the investment products. So 00:02:05.879 --> 00:02:09.639 our mission today is, it's very specific. We 00:02:09.639 --> 00:02:12.120 are going to strip away all that noise. We're 00:02:12.120 --> 00:02:13.919 going back to the beginning. We're going to clarify 00:02:13.919 --> 00:02:16.860 what it originally meant, the precise math that 00:02:16.860 --> 00:02:18.379 makes it work, and then we're going to expose 00:02:18.379 --> 00:02:21.500 the so -called controversy around it. A controversy 00:02:21.500 --> 00:02:24.280 that, as we're about to show, isn't actually 00:02:24.280 --> 00:02:27.719 about true DCA at all. It's about something else 00:02:27.719 --> 00:02:30.659 entirely. Exactly. And to do that right, we have 00:02:30.659 --> 00:02:36.900 to go back to the source. I mean, the absolute 00:02:36.900 --> 00:02:39.819 grandfather of value investing, Benjamin Graham. 00:02:39.979 --> 00:02:42.759 In his book, The Intelligent Investor, which 00:02:42.759 --> 00:02:45.400 is, you know, a foundational text. It's the Bible 00:02:45.400 --> 00:02:47.259 of investing for many. So that's where we're 00:02:47.259 --> 00:02:50.479 starting. Let's define true GCA, the Graham principle. 00:02:50.919 --> 00:02:53.479 Right. So Graham's whole project was to create 00:02:53.479 --> 00:02:56.000 strategies for the average person, the intelligent 00:02:56.000 --> 00:02:58.300 investor, not the Wall Street professional. Someone 00:02:58.300 --> 00:03:00.539 smart, but not an expert who does this all day. 00:03:00.759 --> 00:03:03.479 Exactly. And he defined DCA as a way to apply 00:03:03.479 --> 00:03:05.780 the principles of value investing. Which usually 00:03:05.780 --> 00:03:08.419 involves tons of complicated analysis, right? 00:03:08.639 --> 00:03:11.539 Reading balance sheets and all that. Tons. He 00:03:11.539 --> 00:03:13.860 wanted to apply that logic to the simple act 00:03:13.860 --> 00:03:16.719 of just putting money away from your paycheck. 00:03:17.039 --> 00:03:19.219 So what was his specific definition? What's the 00:03:19.219 --> 00:03:23.300 core mechanic? It's almost almost painfully simple. 00:03:23.620 --> 00:03:26.819 He said DCA means simply that the practitioner 00:03:26.819 --> 00:03:29.780 invests in common stocks the same number of dollars 00:03:29.780 --> 00:03:32.099 each month or each quarter. The same number of 00:03:32.099 --> 00:03:35.000 dollars. That's it. That is the non -negotiable 00:03:35.000 --> 00:03:37.340 anchor of the entire strategy. The dollar amount 00:03:37.340 --> 00:03:40.259 is constant. So it's not about buying, say. 10 00:03:40.259 --> 00:03:42.860 shares of a stock every month. It's about putting 00:03:42.860 --> 00:03:45.360 in 500 bucks every month, no matter what those 00:03:45.360 --> 00:03:48.000 shares cost. Precisely. And that fixed dollar 00:03:48.000 --> 00:03:50.360 rule is, well, it's the behavioral genius of 00:03:50.360 --> 00:03:52.300 the whole plan. How so? Because the amount of 00:03:52.300 --> 00:03:55.000 money is fixed, your actions automatically work 00:03:55.000 --> 00:03:57.599 against the market's craziness. Think about it. 00:03:57.659 --> 00:04:00.599 If you're investing your $500 and the share price 00:04:00.599 --> 00:04:04.000 gets cut in half, say it goes from $100 to 50. 00:04:04.219 --> 00:04:07.919 My $500 now buys twice as many shares. You automatically 00:04:07.919 --> 00:04:10.310 buy double the shares. You load up. And if the 00:04:10.310 --> 00:04:13.189 price skyrockets, your $500 automatically buys 00:04:13.189 --> 00:04:16.209 fewer shares. So it forces you to be greedy when 00:04:16.209 --> 00:04:18.870 others are fearful and cautious when others are 00:04:18.870 --> 00:04:21.670 euphoric to use the Buffett line. Exactly. But 00:04:21.670 --> 00:04:23.269 you don't have to think about it. The discipline 00:04:23.269 --> 00:04:25.629 is just built right into the system. It bypasses 00:04:25.629 --> 00:04:27.870 all that emotional decision making that trips 00:04:27.870 --> 00:04:31.170 people up. That consistency is huge. But the 00:04:31.170 --> 00:04:34.509 sources also get into the... the hard math behind 00:04:34.509 --> 00:04:37.370 it, why it's actually superior. They do. But 00:04:37.370 --> 00:04:39.189 before we get to the formulas, let's just quickly 00:04:39.189 --> 00:04:41.110 talk about the name, because this is where the 00:04:41.110 --> 00:04:43.990 global confusion really starts to creep in. DCA 00:04:43.990 --> 00:04:46.189 isn't the only name for it. Nope. In the UK, 00:04:46.350 --> 00:04:49.129 you'll hear it called pound cost averaging. Makes 00:04:49.129 --> 00:04:51.350 sense. Sure. And in other contexts, you might 00:04:51.350 --> 00:04:53.730 hear unit cost averaging, incremental trading, 00:04:53.850 --> 00:04:56.629 or even the cost average effect. It's all the 00:04:56.629 --> 00:04:59.430 same core idea. And just as important, the sources 00:04:59.430 --> 00:05:03.810 warn us what DCA is not. Right. Even back then, 00:05:03.910 --> 00:05:05.649 Graham had to make this distinction. You cannot 00:05:05.649 --> 00:05:09.430 confuse his DCA, the fixed dollar plan, with 00:05:09.430 --> 00:05:11.629 something called a constant dollar plan. Wait, 00:05:11.709 --> 00:05:14.050 OK, that's confusing. DCA uses a constant dollar 00:05:14.050 --> 00:05:16.629 amount. So what on earth is a constant dollar 00:05:16.629 --> 00:05:18.709 plan? It's a great question. And the terminology 00:05:18.709 --> 00:05:21.990 is, frankly, not great. It's easy to mix them 00:05:21.990 --> 00:05:25.089 up. True DCA is all about your contributions, 00:05:25.370 --> 00:05:27.529 the new money you're putting into the market. 00:05:27.709 --> 00:05:30.009 OK. A constant dollar plan, on the other hand, 00:05:30.009 --> 00:05:33.040 is a rebalancing strategy. It's about maintaining 00:05:33.040 --> 00:05:35.779 a portfolio. It means you decide you want to 00:05:35.779 --> 00:05:38.839 keep a fixed dollar value in an asset. So, like, 00:05:38.899 --> 00:05:41.839 I decide I always want $10 ,000 worth of gold 00:05:41.839 --> 00:05:45.000 in my portfolio. If gold's price shoots up, my 00:05:45.000 --> 00:05:47.480 holding is now worth $12 ,000. So you'd sell 00:05:47.480 --> 00:05:50.500 $2 ,000 worth to get back to your $10 ,000 target. 00:05:50.680 --> 00:05:52.779 And if the price crashes, I'd have to buy more 00:05:52.779 --> 00:05:54.920 to get back up to $10 ,000. Exactly. It's a risk 00:05:54.920 --> 00:05:57.120 management tool. It's about maintaining a specific 00:05:57.120 --> 00:06:01.120 allocation. DCA is about accumulation and growth 00:06:01.120 --> 00:06:04.000 from new income. They are operationally worlds 00:06:04.000 --> 00:06:06.680 apart. Okay. Distinction made. That's clear. 00:06:06.860 --> 00:06:09.379 Okay. Now let's get into the math. The sources 00:06:09.379 --> 00:06:11.199 bring up something called the harmonic mean. 00:06:11.639 --> 00:06:14.660 I think most of us remember the simple average, 00:06:14.939 --> 00:06:17.480 you know, the arithmetic mean. What is the harmonic 00:06:17.480 --> 00:06:19.980 mean and why is it the secret sauce here? This 00:06:19.980 --> 00:06:23.180 is really the aha moment for true DCA. It's why 00:06:23.180 --> 00:06:25.879 the math is so powerful. You're right. Most people 00:06:25.879 --> 00:06:28.480 just think of the simple average. You add up 00:06:28.480 --> 00:06:30.279 all the prices you paid and divide by the number 00:06:30.279 --> 00:06:32.980 of purchases. Right. The harmonic mean is different. 00:06:33.060 --> 00:06:35.379 It's a special type of average that gives more 00:06:35.379 --> 00:06:39.240 weight to the lower numbers in a set. Why? What's 00:06:39.240 --> 00:06:41.439 the logic there? Think of it in terms of rates. 00:06:41.839 --> 00:06:44.319 The harmonic mean is what you use when you're 00:06:44.319 --> 00:06:47.019 averaging rates, like, say, your average speed 00:06:47.019 --> 00:06:49.540 on a road trip with different speed limits, or 00:06:49.540 --> 00:06:51.519 in this case, the weight at which your dollars 00:06:51.519 --> 00:06:54.240 buy shares. Ah, okay. So because I'm investing 00:06:54.240 --> 00:06:57.459 a fixed amount of money, when the price is low, 00:06:57.660 --> 00:07:01.339 my money is working at a higher... rate. It's 00:07:01.339 --> 00:07:03.720 buying more units. Precisely. You're buying a 00:07:03.720 --> 00:07:05.920 higher quantity of shares at those lower prices. 00:07:06.040 --> 00:07:09.199 So those lower prices have this sort of gravitational 00:07:09.199 --> 00:07:12.240 pull on your overall average cost. They matter 00:07:12.240 --> 00:07:14.879 more. And the key mathematical insight here is 00:07:14.879 --> 00:07:17.360 what? The key insight is that for any set of 00:07:17.360 --> 00:07:19.639 numbers that aren't all identical, the harmonic 00:07:19.639 --> 00:07:22.000 mean is always lower than the arithmetic mean. 00:07:22.180 --> 00:07:25.259 Always. So because the DCA calculation is based 00:07:25.259 --> 00:07:28.779 on this naturally lower average price, the harmonic 00:07:28.779 --> 00:07:31.870 mean I mathematically end up with a lower cost 00:07:31.870 --> 00:07:35.029 per share than if I, say, bought a fixed number 00:07:35.029 --> 00:07:37.089 of shares each month. Absolutely. It's a mathematical 00:07:37.089 --> 00:07:39.889 certainty. And this proves why DCA is superior 00:07:39.889 --> 00:07:42.430 to that and, more importantly, superior to just 00:07:42.430 --> 00:07:45.069 saving up your cash and trying to time the market 00:07:45.069 --> 00:07:47.370 with your regular income. That last part is so 00:07:47.370 --> 00:07:49.790 important. If you just accept that, historically, 00:07:50.069 --> 00:07:52.269 markets go up over the long term. Which is what 00:07:52.269 --> 00:07:54.610 all the data shows. Then holding cash is a losing 00:07:54.610 --> 00:07:57.430 game. DCA gets your money working immediately 00:07:57.430 --> 00:08:00.110 in that upward trend, while the fixed dollar 00:08:00.110 --> 00:08:02.509 mechanism helps manage the scary short -term 00:08:02.509 --> 00:08:05.629 swings. You avoid that paralysis of holding cash, 00:08:05.910 --> 00:08:08.329 waiting for the perfect moment that never comes. 00:08:08.509 --> 00:08:10.410 And that really sums up the whole theory of true 00:08:10.410 --> 00:08:13.050 DCA. It's a fixed dollar regular contribution 00:08:13.050 --> 00:08:15.949 strategy that uses the math of the mormonic mean 00:08:15.949 --> 00:08:18.129 to get you a better price over time, as long 00:08:18.129 --> 00:08:20.639 as you believe markets will grow. Right. We get 00:08:20.639 --> 00:08:22.839 the theory. We get the math. Now let's move to 00:08:22.839 --> 00:08:25.560 segment two and talk about actually doing this. 00:08:25.800 --> 00:08:29.060 We need to push this elegant theory through the 00:08:29.060 --> 00:08:31.680 messy gears of the real world. Right. The practical 00:08:31.680 --> 00:08:34.159 side. We'll talk about how simple it is to set 00:08:34.159 --> 00:08:37.960 up, but also the one crucial detail that can 00:08:37.960 --> 00:08:40.820 absolutely torpedo the whole strategy if you 00:08:40.820 --> 00:08:45.080 ignore it. And that's the crippling drag of brokerage 00:08:45.080 --> 00:08:47.440 fees. Yeah. Implementation is everything. And 00:08:47.440 --> 00:08:50.059 for true DCA, Graham's version, it really only 00:08:50.059 --> 00:08:52.379 requires two decisions from you, the investor. 00:08:52.539 --> 00:08:55.679 Just two. Just two. First, the fixed amount of 00:08:55.679 --> 00:08:57.460 money you're going to invest each period. That's 00:08:57.460 --> 00:08:59.440 usually just based on your budget, your income. 00:08:59.580 --> 00:09:02.159 And second, the frequency. How often are you 00:09:02.159 --> 00:09:05.100 going to invest it? And that simplicity is, I 00:09:05.100 --> 00:09:07.840 think, its superpower. Two decisions. You set 00:09:07.840 --> 00:09:09.960 it up and you walk away. Set it and forget it. 00:09:09.980 --> 00:09:11.740 No more agonizing over whether now is a good 00:09:11.740 --> 00:09:13.379 time to buy. You just automate the whole thing. 00:09:13.519 --> 00:09:15.639 Payroll deductions, scheduled bank transfers. 00:09:15.820 --> 00:09:17.480 You just line it up with whenever you get paid. 00:09:17.559 --> 00:09:19.519 You get paid fortnightly, you invest fortnightly. 00:09:19.519 --> 00:09:21.700 Simple. The psychological freedom that gives 00:09:21.700 --> 00:09:24.200 you is immense. You're no longer tempted to stop 00:09:24.200 --> 00:09:26.399 investing when the market looks scary or to pile 00:09:26.399 --> 00:09:29.360 in when it's euphoric. The discipline is automatic. 00:09:29.779 --> 00:09:33.100 But, and this is a big but, the sources bring 00:09:33.100 --> 00:09:36.200 up this really critical and I think often overlooked 00:09:36.200 --> 00:09:40.740 problem, transaction costs. Now, you know, today 00:09:40.740 --> 00:09:43.259 in the age of commission -free trading apps, 00:09:43.440 --> 00:09:46.000 a lot of people might not even think about brokerage 00:09:46.000 --> 00:09:48.980 fees. But for some assets or on some platforms, 00:09:49.159 --> 00:09:51.850 they still exist. And a fixed fee can turn this 00:09:51.850 --> 00:09:54.149 beautiful strategy into a financial disaster. 00:09:54.509 --> 00:09:56.730 That's absolutely right. When you're buying something 00:09:56.730 --> 00:10:00.070 that has a fixed transaction cost, a flat $10 00:10:00.070 --> 00:10:03.549 brokerage fee per trade, for example, the frequency 00:10:03.549 --> 00:10:05.889 of your investment suddenly becomes incredibly 00:10:05.889 --> 00:10:07.929 important. Because if you're investing small 00:10:07.929 --> 00:10:10.429 amounts really often. The drag from those costs 00:10:10.429 --> 00:10:12.549 can actually be bigger than the return you expect 00:10:12.549 --> 00:10:14.370 to make in that short period. It's like trying 00:10:14.370 --> 00:10:16.269 to run a race with an anchor tied to your leg. 00:10:16.429 --> 00:10:19.330 Death by a thousand paper cuts. You're religiously 00:10:19.330 --> 00:10:22.269 buying every week, but that $15 fee is just eating 00:10:22.269 --> 00:10:24.330 away at your capital before it even has a chance 00:10:24.330 --> 00:10:27.269 to grow. Exactly. Now, this isn't an issue if 00:10:27.269 --> 00:10:29.889 the fee is a percentage of your investment or 00:10:29.889 --> 00:10:32.450 if you're in, say, a managed fund with no explicit 00:10:32.450 --> 00:10:35.110 trading costs. But if you're buying individual 00:10:35.110 --> 00:10:38.269 stocks or ETFs and paying a flat fee, you have 00:10:38.269 --> 00:10:40.509 to do the math. Okay, to really make this stick, 00:10:40.710 --> 00:10:42.490 let's walk through the exact example from the 00:10:42.490 --> 00:10:45.200 source material. Because the numbers are... They're 00:10:45.200 --> 00:10:47.740 pretty stark. Let's do it. So let's imagine an 00:10:47.740 --> 00:10:50.799 investor. They have $500 available every two 00:10:50.799 --> 00:10:54.100 weeks, every fortnight to invest. Okay. The brokerage 00:10:54.100 --> 00:10:58.399 cost is a fixed $20 per transaction. And let's 00:10:58.399 --> 00:11:00.679 say the expected annual return on the asset they're 00:11:00.679 --> 00:11:05.019 buying is 6%. Got it. So scenario one, the investor 00:11:05.019 --> 00:11:07.679 is super disciplined. They stick to that fortnightly 00:11:07.679 --> 00:11:11.620 schedule, investing $500 every two weeks. What's 00:11:11.620 --> 00:11:13.970 the immediate damage from that fee? Well, the 00:11:13.970 --> 00:11:17.509 fee is $20 on a $500 investment. You can do the 00:11:17.509 --> 00:11:19.929 math right there. That's 4%. 4 % of your capital 00:11:19.929 --> 00:11:22.690 is gone instantly. Wow. Now compare that to your 00:11:22.690 --> 00:11:26.090 expected return. A 6 % annual return broken down 00:11:26.090 --> 00:11:29.389 over a two -week period is only about 0 .23%. 00:11:29.389 --> 00:11:33.009 Wait, wait. So you are paying a 4 % fee. to try 00:11:33.009 --> 00:11:39.049 and capture an expected gain of 0 .23%. The cost 00:11:39.049 --> 00:11:42.070 is almost 20 times higher than the expected return. 00:11:42.350 --> 00:11:44.929 That's not just a drag. That's a guaranteed loss 00:11:44.929 --> 00:11:47.429 on that contribution. It is. It's a disaster. 00:11:47.830 --> 00:11:50.429 The DCA mechanism is trying to work, but the 00:11:50.429 --> 00:11:52.549 transaction cost is just completely overwhelming 00:11:52.549 --> 00:11:55.070 it. So the only way to fix this is to change 00:11:55.070 --> 00:11:57.470 one of your two variables. Frequency. The frequency. 00:11:58.000 --> 00:12:00.500 You have to invest less often, which means you're 00:12:00.500 --> 00:12:03.639 investing a larger amount each time, which makes 00:12:03.639 --> 00:12:06.159 that fixed fee a smaller percentage of your total. 00:12:06.299 --> 00:12:08.460 Okay, scenario two then. Let's change the period. 00:12:08.879 --> 00:12:10.320 Instead of every two weeks, let's go to every 00:12:10.320 --> 00:12:13.580 four weeks. So we're investing $1 ,000 once a 00:12:13.580 --> 00:12:17.000 month. OK. The brokerage fee is still $20, but 00:12:17.000 --> 00:12:19.720 now it's on $1 ,000 investment. So the cost drops 00:12:19.720 --> 00:12:22.860 from 4 % to 2%. That's a big improvement. Halved 00:12:22.860 --> 00:12:25.279 it. It is. And your expected return for that 00:12:25.279 --> 00:12:28.299 four -week period also goes up to about 0 .46%. 00:12:28.299 --> 00:12:32.019 So it's better. But the 2 % cost is still way 00:12:32.019 --> 00:12:36.320 higher than the 0 .46 % return. You're still 00:12:36.320 --> 00:12:38.320 starting in a hole. You're still starting in 00:12:38.320 --> 00:12:40.980 a pretty deep hole. The lesson is that even if 00:12:40.980 --> 00:12:44.419 the theory of DCA is perfect, a bad implementation 00:12:44.419 --> 00:12:47.100 because of fees can make it completely ineffective 00:12:47.100 --> 00:12:49.700 in practice. So what's the sweet spot? Where's 00:12:49.700 --> 00:12:52.610 the optimal point in this scenario? Well, the 00:12:52.610 --> 00:12:55.009 source material actually runs the numbers and 00:12:55.009 --> 00:12:57.409 suggests that the optimum period is 10 weeks. 00:12:57.529 --> 00:13:00.009 10 weeks. OK, break that down. So over 10 weeks, 00:13:00.129 --> 00:13:02.710 our investor would save up five of their fortnightly 00:13:02.710 --> 00:13:06.570 payments. That's $2 ,500. And they make just 00:13:06.570 --> 00:13:10.429 one trade, one $20 transaction. Correct. So that 00:13:10.429 --> 00:13:14.610 $20 fee on a $2 ,500 investment is now only 0 00:13:14.610 --> 00:13:18.389 .8%. Much more manageable. And what's the expected 00:13:18.389 --> 00:13:21.470 return over 10 weeks? The expected return over 00:13:21.470 --> 00:13:25.409 that 10 -week period is 1 .15%. Ah, now we've 00:13:25.409 --> 00:13:27.649 flipped it. Now you've flipped it. The expected 00:13:27.649 --> 00:13:30.049 return is finally higher than the cost of the 00:13:30.049 --> 00:13:32.110 transaction. You're actually starting with a 00:13:32.110 --> 00:13:35.070 positive expectation. This example is so powerful. 00:13:35.549 --> 00:13:38.730 It proves that real -world DCA isn't just about 00:13:38.730 --> 00:13:41.409 the fixed amount. That frequency decision is 00:13:41.409 --> 00:13:43.950 absolutely critical, and you have to calibrate 00:13:43.950 --> 00:13:46.009 it based on your transaction costs. You have 00:13:46.009 --> 00:13:47.570 to. It's the difference between the strategy 00:13:47.570 --> 00:13:49.750 working for you and you just making your broker 00:13:49.750 --> 00:13:52.610 rich. And that moves us perfectly from the practical 00:13:52.610 --> 00:13:55.500 details into segment three. the great confusion. 00:13:56.039 --> 00:13:59.340 Because if true DCA is this elegant, disciplined, 00:13:59.600 --> 00:14:02.539 income -based strategy, then why is everyone 00:14:02.539 --> 00:14:04.279 always arguing about it? Why are there so many 00:14:04.279 --> 00:14:06.720 articles saying it's suboptimal? This is it. 00:14:06.820 --> 00:14:09.379 This is the heart of the problem. The answer 00:14:09.379 --> 00:14:12.320 is that the entire modern debate has been corrupted 00:14:12.320 --> 00:14:16.139 by a profound confusion between true DCA and 00:14:16.139 --> 00:14:18.779 what we can call the windfall strategy. Oh, windfall. 00:14:18.879 --> 00:14:21.159 So a situation that is the complete opposite 00:14:21.159 --> 00:14:23.519 of a regular paycheck. The complete opposite. 00:14:23.639 --> 00:14:25.620 We're talking about an investor who suddenly 00:14:25.620 --> 00:14:28.879 receives a large one time lump sum of cash. Maybe 00:14:28.879 --> 00:14:31.200 it's an inheritance, an insurance payout, a big 00:14:31.200 --> 00:14:33.200 bonus from work. So they have a pile of cash 00:14:33.200 --> 00:14:35.379 sitting there right now and they need to plan 00:14:35.379 --> 00:14:38.000 for it. And instead of investing it all at once, 00:14:38.080 --> 00:14:40.419 which is called a lump sum investment or LSI, 00:14:40.639 --> 00:14:44.539 many investors get scared and they choose to 00:14:44.539 --> 00:14:46.759 drip feed that windfall into the market over 00:14:46.759 --> 00:14:49.600 time, say over six months or a year. That delayed 00:14:49.600 --> 00:14:52.299 staged approach. Is what Vanguard, which has 00:14:52.299 --> 00:14:54.320 done the best research on this, likes to call 00:14:54.320 --> 00:14:57.759 a systematic implementation plan or SIP. But 00:14:57.759 --> 00:15:00.049 that's not what the media calls it. No. The media, 00:15:00.210 --> 00:15:02.850 the finance industry, marketing materials, they 00:15:02.850 --> 00:15:05.330 all just call it dollar cost averaging. And that's 00:15:05.330 --> 00:15:07.789 the original sin. So why do people choose that 00:15:07.789 --> 00:15:11.809 SIP strategy? Why delay? It's 100 % driven by 00:15:11.809 --> 00:15:15.009 fear. It's the fear of timing risk. The fear 00:15:15.009 --> 00:15:16.710 that you'll put your entire inheritance into 00:15:16.710 --> 00:15:19.169 the market on a Monday and by Friday the market 00:15:19.169 --> 00:15:21.909 has crashed 10%. That is the nightmare scenario 00:15:21.909 --> 00:15:23.549 they're trying to avoid. They're trying to buy 00:15:23.549 --> 00:15:26.629 emotional insurance against that specific worst 00:15:26.629 --> 00:15:29.090 case outcome. And on the surface, it looks a 00:15:29.090 --> 00:15:31.549 bit like DCA, right? Regular investments over 00:15:31.549 --> 00:15:34.110 time. But the source of the capital is completely 00:15:34.110 --> 00:15:36.289 different. So we have two totally different things. 00:15:36.730 --> 00:15:40.250 True DCA, investing regular income over time 00:15:40.250 --> 00:15:44.309 to build wealth. And SIP, delaying the investment 00:15:44.309 --> 00:15:46.730 of a lump sum you already have to manage fear. 00:15:47.070 --> 00:15:50.690 They look similar, but their purpose, their starting 00:15:50.690 --> 00:15:53.070 point, their whole mathematical context, it's 00:15:53.070 --> 00:15:55.529 night and day. And the sources point out how 00:15:55.529 --> 00:15:59.100 just, how persistent. this mistake is. Yeah. 00:15:59.220 --> 00:16:00.940 Even at the highest levels. It's incredible. 00:16:01.059 --> 00:16:03.419 You mentioned Vanguard. They published a fantastic 00:16:03.419 --> 00:16:06.759 research paper that explicitly made this distinction. 00:16:06.940 --> 00:16:09.580 They said, look, our SIP strategy for lump sums 00:16:09.580 --> 00:16:12.639 is not the same thing as true DCA for regular 00:16:12.639 --> 00:16:14.679 savings. They drew a clear line in the sand. 00:16:14.840 --> 00:16:18.340 They did. But then what happened? In other more 00:16:18.340 --> 00:16:20.440 client facing brochures and articles, they went 00:16:20.440 --> 00:16:22.440 right back to calling the delayed windfall strategy 00:16:22.440 --> 00:16:25.460 dollar cost averaging. Why? Is it just easier? 00:16:25.740 --> 00:16:28.379 Laziness? It's probably a bit of both. Once a 00:16:28.379 --> 00:16:30.500 term gets into the public consciousness, it's 00:16:30.500 --> 00:16:32.820 really, really hard to correct it. It's easier 00:16:32.820 --> 00:16:34.940 to just use the term your clients think they 00:16:34.940 --> 00:16:37.600 understand, even if it's technically wrong. This 00:16:37.600 --> 00:16:40.120 is the big reveal for our listeners. If you're 00:16:40.120 --> 00:16:42.120 reading an article today that's debating the 00:16:42.120 --> 00:16:45.980 pros and cons of DCA, there is a 99 % chance 00:16:45.980 --> 00:16:49.000 they are not talking about your monthly 401k 00:16:49.000 --> 00:16:51.340 contribution. They're talking about what to do 00:16:51.340 --> 00:16:54.460 with a big inheritance and the math. for those 00:16:54.460 --> 00:16:57.080 two situations is completely different. And it's 00:16:57.080 --> 00:16:59.340 not just cash windfalls, right? The sources say 00:16:59.340 --> 00:17:01.519 the same confusion happens with big portfolio 00:17:01.519 --> 00:17:04.539 changes. Yeah. Another great example. Let's say 00:17:04.539 --> 00:17:06.299 you're an investor. You're pretty conservative. 00:17:06.579 --> 00:17:10.440 You have 80 % in bonds and 20 % in stocks. Okay. 00:17:10.599 --> 00:17:13.180 And you decide, you know what? I need to be more 00:17:13.180 --> 00:17:16.279 aggressive. My plan says I should be at a 50 00:17:16.279 --> 00:17:18.740 -50 split. So you've made the intellectual decision. 00:17:19.259 --> 00:17:21.519 The allocation needs to change now. You need 00:17:21.519 --> 00:17:24.079 to sell a huge chunk of bonds and buy a huge 00:17:24.079 --> 00:17:26.299 chunk of stocks. But then that fear kicks in 00:17:26.299 --> 00:17:29.200 again. What if I make this huge shift today and 00:17:29.200 --> 00:17:31.740 the stock market crashes tomorrow? Timing risk. 00:17:31.900 --> 00:17:34.119 Timing risk again. So instead of just ripping 00:17:34.119 --> 00:17:36.299 the Band -Aid off and making the trade, they 00:17:36.299 --> 00:17:38.759 decide to stage it. We'll shift 5 % this month, 00:17:38.839 --> 00:17:41.440 5 % next month. Which totally defeats the purpose 00:17:41.440 --> 00:17:44.079 of the original decision. You decided you needed 00:17:44.079 --> 00:17:47.200 more stock exposure today, but your fear is making 00:17:47.200 --> 00:17:49.940 you delay getting that exposure. In every one 00:17:49.940 --> 00:17:52.740 of these scenarios, the driver is fear of short 00:17:52.740 --> 00:17:56.279 -term regret. And the tool they use to manage 00:17:56.279 --> 00:17:59.180 that fear, the staged investment, the SIP gets 00:17:59.180 --> 00:18:03.000 mislabeled as DCA. And that mislabeling obscures 00:18:03.000 --> 00:18:05.299 the beautiful, simple strategy Graham actually 00:18:05.299 --> 00:18:07.819 created for regular savers. Which is what we 00:18:07.819 --> 00:18:10.299 need to get back to. Understanding this distinction 00:18:10.299 --> 00:18:13.079 unlocks the entire modern debate. Which brings 00:18:13.079 --> 00:18:16.339 us to segment four. We're talking risks, benefits, 00:18:16.460 --> 00:18:18.920 and the surprising power of behavioral psychology. 00:18:19.160 --> 00:18:22.140 Right. So we've established that for true DCA 00:18:22.140 --> 00:18:25.440 grams DCA, using your income, the math is pretty 00:18:25.440 --> 00:18:27.440 solid. If you expect markets to go up in the 00:18:27.440 --> 00:18:30.059 long run, it beats hoarding cash. It does, though 00:18:30.059 --> 00:18:31.859 we should acknowledge the contrarians. The sources 00:18:31.859 --> 00:18:34.160 do note that you'll find advisors like Suze Orman, 00:18:34.180 --> 00:18:36.900 who are huge champions of DCA, but you'll also 00:18:36.900 --> 00:18:39.019 find others who dismiss it. They call it a marketing 00:18:39.019 --> 00:18:41.430 gimmick. But this is where that confusion does 00:18:41.430 --> 00:18:44.150 real damage, because almost all of that negative 00:18:44.150 --> 00:18:46.950 chatter is aimed at the windfall scenario. And 00:18:46.950 --> 00:18:49.710 it leads to this really misleading headline conclusion 00:18:49.710 --> 00:18:54.289 that DCA is suboptimal. That is the suboptimality 00:18:54.289 --> 00:18:57.250 trap. The entire public debate is about SESI 00:18:57.250 --> 00:19:00.470 -P versus LSI. It's about the windfall. And the 00:19:00.470 --> 00:19:02.670 shocking discovery that researchers have made 00:19:02.670 --> 00:19:05.410 is that SI -P is often mathematically worse than 00:19:05.410 --> 00:19:07.950 just investing the lump sum immediately. OK, 00:19:08.009 --> 00:19:10.039 let's get into that. Why is investing the lump 00:19:10.039 --> 00:19:13.160 sum all at once usually better? What does the 00:19:13.160 --> 00:19:15.839 data say? The Vanguard modeling on this is the 00:19:15.839 --> 00:19:17.920 gold standard. They looked back through market 00:19:17.920 --> 00:19:20.380 history and compared the two strategies. What 00:19:20.380 --> 00:19:22.440 they found was that investing a windfall immediately, 00:19:22.740 --> 00:19:26.160 the LSI approach, outperformed the delayed systematic 00:19:26.160 --> 00:19:28.900 approach. About two -thirds of the time. Two 00:19:28.900 --> 00:19:31.680 -thirds. So 66 % of the time, the person who 00:19:31.680 --> 00:19:33.799 was brave and just put all the money in at once 00:19:33.799 --> 00:19:35.920 ended up with more money. A lot more in some 00:19:35.920 --> 00:19:38.519 cases. Why does delaying face such a big statistical 00:19:38.519 --> 00:19:41.319 headwind? It's just opportunity cost. It's the 00:19:41.319 --> 00:19:44.200 cost of holding cash. If you believe the market 00:19:44.200 --> 00:19:47.480 has a positive expected return over time, that 00:19:47.480 --> 00:19:50.420 it trends upward, then every single day your 00:19:50.420 --> 00:19:53.019 windfall is sitting in cash is a day you're missing 00:19:53.019 --> 00:19:55.319 out on that expected gain. You're betting against 00:19:55.319 --> 00:19:57.980 the long term trend. You're knowingly choosing 00:19:57.980 --> 00:20:00.480 to invest at a future date, even though you expect 00:20:00.480 --> 00:20:02.579 prices in the future to be higher than they are 00:20:02.579 --> 00:20:05.680 today. That cash isn't just waiting. It's losing 00:20:05.680 --> 00:20:08.559 purchasing power to inflation and it's missing. 00:20:08.750 --> 00:20:11.190 out on compounding. You're giving up a very likely 00:20:11.190 --> 00:20:13.950 higher return in exchange for protecting yourself 00:20:13.950 --> 00:20:17.150 against a less likely immediate crash. Mathematically, 00:20:17.269 --> 00:20:19.049 that's not a great trade most of the time. And 00:20:19.049 --> 00:20:21.329 this leads us to the real disservice this confusion 00:20:21.329 --> 00:20:24.410 does to the regular investor. The valid criticisms 00:20:24.410 --> 00:20:27.829 of SIP, that it's mathematically suboptimal for 00:20:27.829 --> 00:20:31.440 a windfall, get misapplied to true DCA. This 00:20:31.440 --> 00:20:33.700 is the real danger. The average person saving 00:20:33.700 --> 00:20:36.799 for retirement is using DCA exactly as Graham 00:20:36.799 --> 00:20:38.619 intended. They're not dealing with a windfall. 00:20:38.700 --> 00:20:40.640 They're just investing from their paycheck. But 00:20:40.640 --> 00:20:43.799 then they see a headline. Why dollar cost averaging 00:20:43.799 --> 00:20:46.240 is a bad strategy. And they think it applies 00:20:46.240 --> 00:20:49.380 to them. And the consequences of that misunderstanding 00:20:49.380 --> 00:20:51.700 can be absolutely disastrous. That's the worst 00:20:51.700 --> 00:20:53.859 case scenario. They might think, oh, I shouldn't 00:20:53.859 --> 00:20:55.980 be investing automatically. I should be timing 00:20:55.980 --> 00:20:58.779 the market with my savings. So when the market 00:20:58.779 --> 00:21:00.980 starts to fall, they do the worst possible thing. 00:21:01.400 --> 00:21:03.740 They stop their retirement contributions. They 00:21:03.740 --> 00:21:06.460 say, I'll wait for the bottom. Which completely 00:21:06.460 --> 00:21:09.019 defeats the purpose of true DCA. The whole point 00:21:09.019 --> 00:21:11.779 is that you keep buying on the way down. That's 00:21:11.779 --> 00:21:13.619 when you acquire the most shares. That's when 00:21:13.619 --> 00:21:15.779 the harmonic mean really works its magic for 00:21:15.779 --> 00:21:18.539 you. Exactly. Confusing Secchi's problems with 00:21:18.539 --> 00:21:21.180 DCA strengths can lead people to abandon the 00:21:21.180 --> 00:21:23.500 single most reliable path to building wealth 00:21:23.500 --> 00:21:26.279 that exists for the average person. Okay, so 00:21:26.279 --> 00:21:29.789 we've established the math. For a windfall, LSI 00:21:29.789 --> 00:21:32.569 wins two -thirds of the time. But let's be human 00:21:32.569 --> 00:21:35.329 for a second. If you put $50 ,000 in the market 00:21:35.329 --> 00:21:37.930 on Monday and by Friday it's worth $45 ,000, 00:21:38.029 --> 00:21:41.049 that feeling is just gut -wrenching. It's awful. 00:21:41.269 --> 00:21:43.309 Do the sources talk about that psychological 00:21:43.309 --> 00:21:46.670 reality? Why would any smart advisor still recommend 00:21:46.670 --> 00:21:50.420 the systematic, delayed approach? They do. And 00:21:50.420 --> 00:21:52.259 this is where it gets really fascinating. We 00:21:52.259 --> 00:21:55.559 have to shift from pure math to behavioral economics. 00:21:55.880 --> 00:21:58.480 And the answer is that some advisors advocate 00:21:58.480 --> 00:22:01.960 for SAP specifically as a behavioral tool. A 00:22:01.960 --> 00:22:03.640 behavioral tool. What does that mean? It means 00:22:03.640 --> 00:22:06.440 for certain investors, the fear is so paralyzing 00:22:06.440 --> 00:22:08.980 that they would never invest the lump sum at 00:22:08.980 --> 00:22:12.240 all. They just let that $50 ,000 sit in a checking 00:22:12.240 --> 00:22:14.839 account, getting eaten by inflation forever. 00:22:15.240 --> 00:22:18.819 So the real comparison isn't SAP versus the math. 00:22:19.019 --> 00:22:23.279 optimal LSI. It's SIP versus doing nothing. And 00:22:23.279 --> 00:22:25.880 in that comparison, SIP wins by a landslide. 00:22:25.960 --> 00:22:28.119 A slightly suboptimal plan that you actually 00:22:28.119 --> 00:22:30.640 execute is infinitely better than a perfect plan 00:22:30.640 --> 00:22:32.940 that you're too scared to act on. SIP allows 00:22:32.940 --> 00:22:34.799 the investor to manage something the courses 00:22:34.799 --> 00:22:37.809 call the asymmetry of regret. Explain that. It's 00:22:37.809 --> 00:22:40.490 a known psychological bias. Studies show that 00:22:40.490 --> 00:22:42.630 the pain we feel from a loss is much stronger 00:22:42.630 --> 00:22:44.190 than the pleasure we feel from an equivalent 00:22:44.190 --> 00:22:47.170 gain. And for investing it means we feel much, 00:22:47.190 --> 00:22:49.710 much worse about investing a lump sum and seeing 00:22:49.710 --> 00:22:52.190 it immediately fall. The regret of a bad action. 00:22:52.369 --> 00:22:55.910 I made a terrible mistake. Exactly. That feels 00:22:55.910 --> 00:22:58.170 way worse than the regret of missing out on some 00:22:58.170 --> 00:23:00.990 gains because we invested too slowly. The regret 00:23:00.990 --> 00:23:04.200 of inaction. That feels less personal. It's less 00:23:04.200 --> 00:23:07.019 acute. You blame the market, not yourself. SIP 00:23:07.019 --> 00:23:09.740 is a strategy designed to minimize that painful, 00:23:09.779 --> 00:23:12.740 immediate regret of a big loss. If the market 00:23:12.740 --> 00:23:14.920 crashes right after you start, you're relieved 00:23:14.920 --> 00:23:18.079 you didn't put it all in. If it soars, well, 00:23:18.160 --> 00:23:20.779 you're still participating. Your regret is diluted. 00:23:20.940 --> 00:23:23.400 So it's a form of emotional control. It takes 00:23:23.400 --> 00:23:26.259 that one massive high stakes emotional decision 00:23:26.259 --> 00:23:29.619 and breaks it down into a series of smaller unemotional 00:23:29.619 --> 00:23:31.880 automatic ones. It puts the plan on autopilot 00:23:31.880 --> 00:23:34.140 and gets the money off the sidelines. The mathematician 00:23:34.140 --> 00:23:37.119 in the room sees lost potential return. The behavioral 00:23:37.119 --> 00:23:39.079 psychologist sees a successful investment that 00:23:39.079 --> 00:23:41.160 actually happened. So if an investor decides, 00:23:41.240 --> 00:23:44.579 look, for my own sanity, I have to use the delayed 00:23:44.579 --> 00:23:47.380 approach for my windfall. Is there any guidance 00:23:47.380 --> 00:23:49.359 on how long that delay should be? Yes, there 00:23:49.359 --> 00:23:52.279 is. One study looked at exactly this question. 00:23:52.460 --> 00:23:54.839 It tried to find the sweet spot, the best time 00:23:54.839 --> 00:23:57.319 horizon that balances the risk and return tradeoff. 00:23:57.400 --> 00:23:59.460 What did it find? It found that if you're going 00:23:59.460 --> 00:24:01.839 to delay, the optimal windows are either 6 or 00:24:01.839 --> 00:24:04.279 12 months. 6 or 12. Right. Anything longer than 00:24:04.279 --> 00:24:06.299 a year. And the odds of you missing out on significant 00:24:06.299 --> 00:24:09.500 gains just become too high. The opportunity cost 00:24:09.500 --> 00:24:11.680 starts to overwhelm the psychological comfort. 00:24:11.880 --> 00:24:14.160 That's a great... practical piece of advice. 00:24:14.220 --> 00:24:15.920 It puts a reasonable boundary on it. It does. 00:24:16.099 --> 00:24:18.740 And it just reinforces the whole point. This 00:24:18.740 --> 00:24:21.740 entire debate about suboptimality is about managing 00:24:21.740 --> 00:24:26.180 fear around a rare one -time event. True DCA 00:24:26.180 --> 00:24:28.940 is about managing the process of regular saving 00:24:28.940 --> 00:24:32.000 using consistency to win over the long term. 00:24:32.160 --> 00:24:34.220 This has been such an important clarification. 00:24:34.680 --> 00:24:37.240 We've really dissected the term dollar cost averaging 00:24:37.240 --> 00:24:39.960 and I hope restored it to its original powerful 00:24:39.960 --> 00:24:42.779 meaning. Let's just bring it all home. Crystalize 00:24:42.779 --> 00:24:44.839 the key takeaway here. Let's do it. We started 00:24:44.839 --> 00:24:47.680 by saying DCA is widely misunderstood, and the 00:24:47.680 --> 00:24:50.160 misunderstanding is all about mixing up a recurring 00:24:50.160 --> 00:24:52.539 savings strategy with a one -time investment 00:24:52.539 --> 00:24:56.259 strategy. So to be perfectly clear, true DCA, 00:24:56.279 --> 00:24:58.859 the Benjamin Graham version, is for your recurring 00:24:58.859 --> 00:25:01.359 contributions from your income. It's the engine 00:25:01.359 --> 00:25:03.900 of your retirement plan. It's consistent. It's 00:25:03.900 --> 00:25:06.720 reliable. It uses the harmonic mean to get you 00:25:06.720 --> 00:25:08.900 a better average price. And it's mathematically 00:25:08.900 --> 00:25:11.859 your best bet if you believe markets go up over 00:25:11.859 --> 00:25:15.140 time. And the whole controversy, all the articles 00:25:15.140 --> 00:25:18.200 about DCA being suboptimal. That almost always 00:25:18.200 --> 00:25:20.660 refers to the systematic implementation plan 00:25:20.660 --> 00:25:24.019 or SIP using a staged approach for a lump sum. 00:25:24.299 --> 00:25:27.200 An approach that is statistically worse than 00:25:27.200 --> 00:25:29.240 investing it all at once about two thirds of 00:25:29.240 --> 00:25:32.039 the time. But which can be a very powerful behavioral 00:25:32.039 --> 00:25:34.920 tool to overcome fear and actually get the money 00:25:34.920 --> 00:25:37.140 invested. So the key takeaway for you listening 00:25:37.140 --> 00:25:40.180 right now is simple. For your regular contributions, 00:25:40.279 --> 00:25:42.279 for building that two and a half million dollar 00:25:42.279 --> 00:25:46.359 nest egg from your salary, the automatic, consistent, 00:25:46.599 --> 00:25:50.259 fixed dollar nature of true DCA is the soundest 00:25:50.259 --> 00:25:52.119 method there is. It takes the most dangerous 00:25:52.119 --> 00:25:55.079 variable out of the equation. You trying to time 00:25:55.079 --> 00:25:57.359 the market. OK, so let's end with a final provocative 00:25:57.359 --> 00:25:59.880 thought. Yeah. It builds on this behavioral side 00:25:59.880 --> 00:26:02.019 of things we've been discussing. We've just established 00:26:02.019 --> 00:26:04.119 that the biggest criticism of this whole concept 00:26:04.119 --> 00:26:06.400 stems from a situation getting a big windfall. 00:26:07.000 --> 00:26:08.759 That's actually a pretty rare event for most 00:26:08.759 --> 00:26:11.119 people. Right. Most people's financial lives 00:26:11.119 --> 00:26:13.980 are about regular income, not lottery wins. So 00:26:13.980 --> 00:26:16.059 the core job of any good investment strategy 00:26:16.059 --> 00:26:19.240 isn't just to be mathematically perfect in a 00:26:19.240 --> 00:26:22.380 spreadsheet. It's to encourage a habit. It's 00:26:22.380 --> 00:26:25.299 to keep you investing consistently. for decades 00:26:25.299 --> 00:26:28.519 execution is everything so we have to ask if 00:26:28.519 --> 00:26:30.400 the ultimate goal is just to get money out of 00:26:30.400 --> 00:26:33.559 cash and into the market to grow is a strategy 00:26:33.559 --> 00:26:35.940 that helps someone simply start even if that 00:26:35.940 --> 00:26:39.279 strategy like sip for a windfall is slightly 00:26:39.279 --> 00:26:42.059 suboptimal in hindsight is that actually more 00:26:42.059 --> 00:26:45.019 valuable for human success than a perfect strategy 00:26:45.019 --> 00:26:47.420 that an investor is too afraid to ever execute 00:26:47.420 --> 00:26:49.579 that's the question isn't it It's the tension 00:26:49.579 --> 00:26:52.380 between what's optimal on paper and what's possible 00:26:52.380 --> 00:26:55.240 in real life. And bridging that gap is maybe 00:26:55.240 --> 00:26:57.099 the most important part of investing. We have 00:26:57.099 --> 00:27:00.000 defined, clarified, and I hope rehabilitated 00:27:00.000 --> 00:27:02.599 the concept of dollar cost averaging. Thank you 00:27:02.599 --> 00:27:04.059 for diving deep with us. We'll see you next time.