When determining when and how to invest your money, history suggests investing in a diversified stock portfolio all at once. A Bernstein Global Research study found that one-year returns for immediate investments averaged 12.2% as compared to 8.1% for dollar-cost-averaging portfolios and 3.6% for cash holdings. It also found that even in the worst market conditions, any losses would have historically been recovered within a maximum of 2-3 years if the investor held onto the stock.
See Jeff Sommer “Hesitating on the High Board of Investing ” NYTimes.com (August 16, 2014)
Posted by Ryan Moore, Associate Editor, Wealth Strategies Journal