What I Learned from 3 Years of Monthly ETF DCA (Long Post)
I've been running a monthly automatic-transfer ETF DCA plan since 2021. At first, it was just 'put in 500,000 won whenever my paycheck comes in'—that was it. But after three years, what stuck with me was the habit more than the returns.
1. Trying to predict the market messes with your head
2. If you don't set up automatic transfers, you will always end up not contributing
3. Often, the best strategy is to not check your account often
4. Rebalancing once a year was enough
No. 3 was especially hard. When I was down -20% in 2022, I really wanted to cut my losses, but if I had sold then, I'd have no returns today.
Of course, this is just my experience and not the definitive answer. Personally, I found that 'how little you got shaken' is more of a skill than 'how much you earned.' I'm curious what rules you all set for yourselves.
8 answers
Agreed—if you don’t set up automatic transfers, literally not a single penny goes in lol. I did the whole “I’ll spend a little more freely this month and put in a lump sum next month” thing for two years, and in the end I never once put anything in.
I really relate to #3... I deleted the app when I was down 20% and just forgot about it, and that was the best thing I ever did.
Well, I somewhat disagree with #3. Not looking at your account isn't always a strategy—it's often just avoidance. I've seen quite a few people who didn't look for five years, then opened it up to find that one stock made up 60% because they hadn't rebalanced. I think it's better to check at least once a quarter.