« EVERYBODY’S DANISH – Vermont Avnue Grammer School | Home | HUMOR & STUFF FROM BUDDIES »
‘PCA’ POSITION COST AVERAGING – Make it work best
By fred | April 9, 2009
A comment for Sean and others that are using PCA for their investments.
Yes, in my humble opinion PCA is the only way to invest your money – however – one big mistake I made and want to pass on to all of you is – timing of trades. I found that doing it weekly was far to often. If you read my book you will find that in many cases doing your Position Cost Averaging program every month or even on a quarterly basic was just as effective.
I found that I was paying broker fees, even if they are only $9 or $10 a trade and making myself a lot more work. I strongly suggest that you find good stocks, set up your program, then go to your calendar and mark it to trade every three month, or at least every other month. I will lay bets that your results will be as good as if you trade daily or weekly.
It took me quite a while to realize this. Check it out, take a stock and go back and find the historical price at dates every three months and do a fictional program. The worst thing you can do as an investor is constantly be fussing with your stocks.
The best, the wisest investors I know, will make their decisions to buy and then but the stocks aways for long periods. With running a success PCA program, do it then let the stock do it’s thing for a few months. Seldom do stocks go straight up – or straight down – why hassle all the little ups and downs? Now if you have a automatic trading program like those put out by Investment systems set the trades high enough so that it takes a bit to get there, don’t fuss with the little stuff.
If I didn’t like PCA I sure as heck would never have wasted the time to write a book about it.
Be good, Uncle Fred
Topics: In The Markets | No Comments »