YTD 2026 Networth tracking thread

[kickass22]

The performance of VAP and whether it outperforms RSP then depends entirely on whether you have set the correct target growth %?

If I understand correctly, you will end up buying more shares when the price is lower and less shares when the price is higher as you will not deploy all the allocated money with VCA compared to DCA.

In this range bound way, you tend to do better with VCA.

 

[hwmook]

William Bernstein talks about this concept in a podcast that I listened too. He mentions that Lump Sum is better than DCA and VCA. But if you are doing DCA vs VCA, both has issues due to the lack of time in the market compared to Lump Sum. However, if you have to go DCA or VCA, he says VCA hsa a higher of chance of getting lucky if there is a market downturn and allows you to benefit from it more.

This is what I am trying to do but with my own tweaks that fits me.

You can listen to the podcast on Youtube here :

He also talk about the book on Value Averaging. Folks who love Math will love this book. Its available in the National Library.

DCA assume market is flat. VCA assume there is a slope. Lump sum is hoping that you buy below market average. IMO VCA is closer to how a market behave and has a greater chance of getting it right. Since market move up over long term, even a monkey anyhow buy also will get it right over the long term.

 

[homer123]

I bought into some HS Tech ETF today. Thought it has gotten low enough to go in. Hope i am right.

Should be ok if you have long runway..I have low allocation of growth tech stock as I am at that stage of retiring.. I think I will stick with dividend stocks.. At least when the price goes down, I still collect some money.

 

[revhappy]

If I understand correctly, you will end up buying more shares when the price is lower and less shares when the price is higher as you will not deploy all the allocated money with VCA compared to DCA.

In this range bound way, you tend to do better with VCA.

I think what @limster is saying, is you need to get the market returns percentage over the period right. For example, your investment horizon is 10 years and you are investing in S&P500. In the next 10 years if lets say S&P 500 returns double, i.e 100% returns. But with lot of volatility in between. If you know before hand that it will be 100% in 10 years, then you can draw the value path and then start investing and you will make awesome returns, because you can use volatility and buy low sell high and make more than 100% returns.

But if you underestimate to 50% returns, then as the market rises, you will keep on selling your stock or allocate lesser and lesser and in the end, you end up with lot of cash.

Similarly, lets say if S&P 500 gives only 20% total return over 10 years but you are expecting 100%, then you think market is very cheap and you keep deploying way too much cash and finally run out of cash in the middle.

So getting that value path over the long term, correct is important.

But I see the value in this value averaging, because I am assuming 0 returns and plan to step up my allocation ratio, so I think this works well for people who are stuck with a huge lump sum of cash and want to deploy it into the markets in a moderate risky way. Lump sum would be too risky, DCA is fixed amount, so you dont make use of any corrections to buy more.

 

[Prof. Utonium]

So in simple numbers it would be like 10 years - 100%, hence 10% growth/year target?

 

[kickass22]

I think what @limster is saying, is you need to get the market returns percentage over the period right. For example, your investment horizon is 10 years and you are investing in S&P500. In the next 10 years if lets say S&P 500 returns double, i.e 100% returns. But with lot of volatility in between. If you know before hand that it will be 100% in 10 years, then you can draw the value path and then start investing and you will make awesome returns, because you can use volatility and buy low sell high and make more than 100% returns.

But if you underestimate to 50% returns, then as the market rises, you will keep on selling your stock or allocate lesser and lesser and in the end, you end up with lot of cash.

Similarly, lets say if S&P 500 gives only 20% total return over 10 years but you are expecting 100%, then you think market is very cheap and you keep deploying way too much cash and finally run out of cash in the middle.

So getting that value path over the long term, correct is important.

But I see the value in this value averaging, because I am assuming 0 returns and plan to step up my allocation ratio, so I think this works well for people who are stuck with a huge lump sum of cash and want to deploy it into the markets in a moderate risky way. Lump sum would be too risky, DCA is fixed amount, so you dont make use of any corrections to buy more.

Hi Revhappy, Thank you for explaining this to me. I guess i've totally misunderstood.

However, I still don't understand why you need to estimate market returns and plot the "value path'? Pardon my ignorance as I might not be good at this and thus am not understanding its purpose.

The way I am thinking about this is that instead of Lump Sum which can be risky if you take all the money and put it in one time OR DCA which is fix sum purchase of shares no matter price of the shares, VCA seems to be better way of doing it for me.

I could be totally wrong as I might have misunderstood this an doing it wrongly.

The way I am thinking about this is , With VCA, I buy the same shares ( VWRA or ISAC ETF) with a fixed amount that I have decided to put in every month. Now when the share price goes down, instead of putting the same fixed amount which is what DCA does, I will buy more as my total VWRA value has gone down. I will stop buying when I have pushed my total VWRA value to what it should be. I will do the reverse if the price goes up.

This is my simple practice to buy more at lower prices and less at higher prices.

Please help me understand where I might be wrong in my understanding.

Thank You.

 

[revhappy]

Hi Revhappy, Thank you for explaining this to me. I guess i've totally misunderstood.

However, I still don't understand why you need to estimate market returns and plot the "value path'? Pardon my ignorance as I might not be good at this and thus am not understanding its purpose.

The way I am thinking about this is that instead of Lump Sum which can be risky if you take all the money and put it in one time OR DCA which is fix sum purchase of shares no matter price of the shares, VCA seems to be better way of doing it for me.

I could be totally wrong as I might have misunderstood this an doing it wrongly.

The way I am thinking about this is , With VCA, I buy the same shares ( VWRA or ISAC ETF) with a fixed amount that I have decided to put in every month. Now when the share price goes down, instead of putting the same fixed amount which is what DCA does, I will buy more as my total VWRA value has gone down. I will stop buying when I have pushed my total VWRA value to what it should be. I will do the reverse if the price goes up.

This is my simple practice to buy more at lower prices and less at higher prices.

Please help me understand where I might be wrong in my understanding.

Thank You.

No worries, I am also figuring it out myself. But sorry can you elaborate a bit more may be with an example?
I just did a simulation of 3 plans
1)Constant share count plan. Buy 10 shares every month
2)DCA $1000 every month
3)VAP assume most conservative path of zero returns

The results are quite surprising to me as well. In constant share count plan we dont buy more when prices fall, so we dont gain as much as in case of DCA.

But in VAP, even with conservative value path, we make superior returns than DCA, when there is more volatility.

Now I thought, maybe in an upward trending market DCA is better than VPA because you end up investing less. So I did a simulation for that as well

But surprise surprise, the returns are not worse than DCA even in upward trending market. But the portfolio deployment is lower in this case, I think that is the only downside of VPA if you do very conservative returns approach. So overall I think VPA sounds great, if you like doing a lot of spreadsheet simulations. @Shiny Things @BBCWatcher @limster

 

[wutawa]

Like most forumers here, I have VOO, VWRA, IWDA+EIMI.
I plan to buy QQQ. Also looking at BNWD, still wondering if it's good.

Wow,u have 4 etfs. Which 1 giving u the most returns now? Is it higher than bank?

 

[yuzu28]

Errr. It means lots of cash and lots of debts? LOL......

There's some advisers who told me before, nowadays debts aren't bad. It can help generate income. Guess its like borrowing to invest in something that returns higher yield that borrowing interest rate? No harm to ask Mr Google.

 

[yuzu28]

Wow,u have 4 etfs. Which 1 giving u the most returns now? Is it higher than bank?

VWRA cos I bought it last year when it's low. But I think still need a longer time to tell. VOO i only started last week.

This year, I also dca $200 monthly into infinity global and s&p fund plus occasional min lumpsum. Global yield is at 5.4%, s&p is at 15%.

 

[$ingaporean]

Should be ok if you have long runway..I have low allocation of growth tech stock as I am at that stage of retiring.. I think I will stick with dividend stocks.. At least when the price goes down, I still collect some money.

I have both growth and value in my portfolio, just to complement each other.

DCA assume market is flat. VCA assume there is a slope. Lump sum is hoping that you buy below market average. IMO VCA is closer to how a market behave and has a greater chance of getting it right. Since market move up over long term, even a monkey anyhow buy also will get it right over the long term.

The probability of market moving up on each day is higher than the probability of market going down. Thats why it is better to do lump sum investing. Having said that, there will be times when market drops over extended period, which then, if a person do lump sum, then he will be unlucky.

Some people advocate distribute the amount over 12 months. But really, this is also as good as betting the market to drop within the 12 months. If market keep rising over the 12 months and crash the next year after he finished deploying his capital, the investor also suck thumb.

I think whichever method you use, there is always pros and cons depending on how the market moved over the period. Unless you are good enough to lump sum invest in the correct time, like just after a market correction or even better, crash, or in an upward trend. If you are the DCA type, then likely you cant be one to time the market.

 

[gld998]

William Bernstein talks about this concept in a podcast that I listened too. He mentions that Lump Sum is better than DCA and VCA. But if you are doing DCA vs VCA, both has issues due to the lack of time in the market compared to Lump Sum. However, if you have to go DCA or VCA, he says VCA hsa a higher of chance of getting lucky if there is a market downturn and allows you to benefit from it more.

This is what I am trying to do but with my own tweaks that fits me.

You can listen to the podcast on Youtube here :

He also talk about the book on Value Averaging. Folks who love Math will love this book. Its available in the National Library.

I doing both Lum Sum and DCA... keep some money in warchest and DCA monthly. Use Warchest to buy on the dip. Warchest dry, monthly topup again and bonus topup, DCA on the dates on stocks when its the lowest, normally 12th to 15th each month..

pls do correct me if there is something wrong with this strategy.

 

[limster]

I doing both Lum Sum and DCA... keep some money in warchest and DCA monthly. Use Warchest to buy on the dip. Warchest dry, monthly topup again and bonus topup, DCA on the dates on stocks when its the lowest, normally 12th to 15th each month..

pls do correct me if there is something wrong with this strategy.

This is my strategy too!

However, it only works if you are prepared to use the warchest. There are some investors, when the time comes for them to open warchest, they become too scared and keep on asking whether the market will go down further, and when the market recover, they start asking if the boat has sailed already.

 

[tkdboi]

I doing both Lum Sum and DCA... keep some money in warchest and DCA monthly. Use Warchest to buy on the dip. Warchest dry, monthly topup again and bonus topup, DCA on the dates on stocks when its the lowest, normally 12th to 15th each month..
pls do correct me if there is something wrong with this strategy.

I am also doing this too now after sticking to DCA only previously.



Read HWZ Forum Rules!

 

[yuzu28]

I doing both Lum Sum and DCA... keep some money in warchest and DCA monthly. Use Warchest to buy on the dip. Warchest dry, monthly topup again and bonus topup, DCA on the dates on stocks when its the lowest, normally 12th to 15th each month..

pls do correct me if there is something wrong with this strategy.

Which ones normally lowest between 12th to 15th?

 

[yuzu28]

This is my strategy too!

However, it only works if you are prepared to use the warchest. There are some investors, when the time comes for them to open warchest, they become too scared and keep on asking whether the market will go down further, and when the market recover, they start asking if the boat has sailed already.

U are so right! I'm one of them!

 

[highsulphur]

Im just doing DCA at the moment after setting aside emergency cash of 1 year of expenses. The concept of a "warchest" is hard to quantify to be honest

 

[gld998]

Which ones normally lowest between 12th to 15th?

as long its a red day then I buy... I just queue at the lowest price previous day.

 

[gld998]

Im just doing DCA at the moment after setting aside emergency cash of 1 year of expenses. The concept of a "warchest" is hard to quantify to be honest

Yeah.. I dunno right or wrong, but what I doing now, if 1k that month extra, 500 go inside DCA and 500 go inside warchest.

 

[tkdboi]

Im just doing DCA at the moment after setting aside emergency cash of 1 year of expenses. The concept of a "warchest" is hard to quantify to be honest

everyone's definition and comfort level will vary.

personally that's where I try to build up more capital in general.

having a larger capital base also allows you the luxury to diversify and also be more willing to take the calculated risks, which can then yield potentially more rewards, while not making you overly worried or needing to cash in.

just that this takes time to build.



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