Hey guys, i was wondering how often you invest. Im debating if i should invest 4 times, 2 times or once a month. So lets say i invest 1000 euro a month. But with 4 times i invest 250 every week and with 2 times i invest 500 once in every two weeks
Studies show that investing as early as possible does best. So 12,000 at the start of the a year, rather than 1,000 per month over the year. This is because the market tends upwards more than downwards. Fewer entry points also means lower transaction fees and less record-keeping for tax. However, there are good reasons why you might not do that:
- maybe you do not have all your investment money ready at the start of the year.
- periodic investment means that you will have the satisfaction of sometimes buying in at a low price, and less regret if the single time point turns out to have been a high price day (so called “dollar cost averaging”)
- it may be more fun to buy more frequently and watch what happens with your positions. Why not have fun with your investing?
On a platform like Trading 212 where there is no fee per transaction, the third bullet is tempting for me (perhaps more than it should be). So I am setting aside a weekly investment amount and drip feed a few days each week. That has meant that I have bought some nice bargains in March/April this year.
So you like to invest weekly?
I am making about 20 purchases a month on Trading 212. Some days 0, other days 5. In accounts with other brokers I use their special day each month when cost to buy in a SIPP is £1.50 rather than the usual £9.99.
Some of my investments are small. Even just £25. It is more fun to invest £50 per day than £250 per week. But other times I have invested 4 or 5 figures at once. Pies are interesting. They can involve making really small investments into each element of the pie. I had never thought a day would come that I would see myself buying 0.001 of a share.
Yea with the pie feature you can spread your risk. I would like to invest a set Amount each month, and by investing it weekly(or more) i spread the risk. I think
I used to fund once a month, then I split that funding into two thirds on the first day of the month and the remaining third roughly a week later. Now I am giving the daily depositing for pie investing a go.
with few deposits it was hard to split the funds across stocks so I ended up with a rather small portfolio of about 4-6 holdings that grew with a certain portion of my funds. 3 holdings made about 90% and the last was split between those 1-3 others.
I think i will go for funding every monday. I did some research and it says the overal monday is the best day to buy. I know on the longterm it doesnt matter that much, but every bits help! So 4 times a month. Thanks for all the responses!
@Pepijn031, why Monday?
Does the market usual dip on Friday afternoons?
I’ve read that if Monday has any advantage it is probably just because earlier is better. In general, more weeks end up than end down.
You may want to avoid buying within the first hour or two of market opening as prices tend to jump up before settling or at least the first 15-20 mins.
Ive read that monday is the best day to buy. Do you guys agree on this or not? Im investing for the long term but i like to figure the details out.
I chose weekly investments on Mondays. I wanted to invest weekly then Monday was chosen after I read this article: https://www.investopedia.com/day-trading/best-time-day-week-month-trade-stocks/
For dollar cost averaging, weekly or biweekly is very fine, if you have a small amount that maybe has to be invested all at once, doing monthly is OK, on the long term you will have a bit higher average cost for your portfolio, but nothing really drastic.
You can also choose according to momentum, if the market is a bullish, then higher amounts early means more returns, so you can choose to invest all at once in a month or biweekly instead of weekly.
But again, besides some very lucky weeks, on the long term the difference won’t be very noticeable.
I have set up a small auto invest for my pay day but plan on manually buying mostly when the premarkets are heavily red. I personally believe there will be another correction in the markets before year-end as prices are out of sync with the fundamentals following the global lock downs. Because of this, i am currently holding a higher % of cash than I’d like.
Once the market stabilises a bit i will fund my account monthly and buy weekly unless there’s a particular opportunity .
Good luck everyone