FYI: Earlier this year I wrote a piece illustrating how it is almost always optimal to invest a large sum of money right away rather than “averaging-in” over time. Sitting in cash (or even in T-Bills) simply doesn’t pay compared to the markets because most markets have a long term positive trend.
Despite the mathematical soundness of my arguments, many people told me privately that they still felt wary about investing lots of money at once because they feared a market crash. My recommended solution to address this fear was simple—go all-in, but do it in a more conservative portfolio. So, if you truly wanted to be invested in 100% stocks (but you were worried about a market crash) it would be better to put it in now into a 80/20 stock/bond portfolio instead of dollar-cost averaging into an all-stock portfolio over time.
Regards,
Ted
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