What time of the day to buy ETFs for the lowest price?

[James_00068]

I guess this question could apply to individual stocks, though would there be more volatility?

Given that an ETF on average gains $1 every day, when is the best time in the day to buy the ETF for the lowest price, if you are buying weekly and holding long term?

1. I'm likely to say within first 5 mins because on avg it will gain $1 by the end of the day? Even if the first 2 hours are the most volatile (-$0.10, +$0.10), it could as equally go down as it could go up, meaning it's a wash?

2. Wouldn't the end of the day be on average be the highest since every day it on avg gains $1?

3. Even if you happened to buy at the highest price everyday, would it even matter since you'd still be gaining $1 everyday?

Are there any studies on this?

Thank you

 

[charlsie]

james, i'm not aware of any studies on this, though the biggest problem i can see is that you're working with averages and that's like trying to put a worm on a hook after you've dipped your hands in olive oil. Buying shares doesn't work like that. They fluctuate and unless you are investing large sums, it would make minimal difference over the long term. personally, I'd save the money and purchase monthly, avoiding the purchase costs. Dollar cost averaging is a time tested and very accepted practice in buying shares.

 

[Belli]

Here is one article on the matter of Lump Sum v DCA. I am sure there are others.

Lump Sum vs Dollar Cost Averaging - Ask The Experts - InvestSMART

I've just sold an investment property so have received a lump sum of cash. Should such a large amount be invested all at once or drip-fed into the markets using dollar-cost averaging? - Submitted by Catherine . Find out more at InvestSMART

www.investsmart.com.au

Personally, when I have the necessary funds, I invest them according to my investment policy based on funds in Home Market v International and within the Home Market holdings a relatively even spread across a number of Listed Investment Companies and VAS. My International is solely in VGS.