Return
Assuming that the same amount of money is invested each time, the return from dollar cost averaging on the total money invested is
where is the final price of the investment and is the harmonic mean of the purchase prices. If the time between purchases is small compared to the investment period, then can be estimated by the harmonic mean of all the prices within the purchase period.
Read more about this topic: Dollar Cost Averaging
Famous quotes containing the word return:
“I believe in the brotherhood of man, all men, but I don’t believe in brotherhood with anybody who doesn’t want brotherhood with me. I believe in treating people right, but I’m not going to waste my time trying to treat somebody right who doesn’t know how to return the treatment.”
—Malcolm X (1925–1965)
“A tree may grow a thousand feet tall, but its leaves will return to its roots.”
—Chinese proverb.
“This spending of the best part of one’s life earning money in order to enjoy a questionable liberty during the least valuable part of it reminds me of the Englishman who went to India to make a fortune first, in order that he might return to England and live the life of a poet. He should have gone up garret at once.”
—Henry David Thoreau (1817–1862)