401k contributions aren't really DCA. It would fall more accurately under DCA if you were given the entire year's 401k contribution at once, and still chose to invest it periodically, rather than all at once.

Or if you got a $10k bonus, and invested it over 6 months or something.

FWIW, lump sum usually beats DCA in the long run.

You may have missed something important, which is you should have some ideal portfolio balance in mind when purchasing. This forces you to “buy low and sell high” in that you buy whatever you need to to bring your percentages in line with you’re ideal. This is the only strategy I’ve seen that provably beats the market (and it’s been a while since I saw the paper talking about this, may be that it only beats the market in terms of total risk adjusted returns, and not total dollars returned).

Edit: also it’s important that you’re asset portfolio has asset classes that tend to be out of phase, like stocks vs bonds.

Worthwhile to read the full article, as well as the sources, and decide what is best for you.

> The financial costs and benefits of DCA have also been examined in many studies using real market data, typically revealing that the strategy does not deliver on its promises and is not an ideal investment strategy.

> Recent research has highlighted the behavioural economic aspects of DCA, which allows investors to make a trade-off between the regret caused by not making the most of a rising market and that caused by investing into a falling market, which are known to be asymmetric.

It's not a 'strategy' really. Most regular Joe investors earn a salary every month, and keep spare money invested in the market. DCA isn't a choice in this case, it's the natural result.

It is a strategy. If you sell your house and invest the proceeds into the stock market, DCA says you shouldn't just do one huge buy order, but you should spread your orders out over a longer timeline. It's two different strategies.

That's an extremely rare case.