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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Simba who wrote (96935)	7/24/2002 2:00:15 PM
From: TimF	Read Replies (1) \| Respond to of 132070

From the chart if you started in June 1993 you have a gross return including dividends of about 18% Since your talking about gross returns the S+P has done a lot better then an 18% gross total return since June 1993 even if dividends are not included. The S+P 500 was about 450 in June of 93 and is about 811 now. That's a gross return of about 80%. With dividends reinvested you get an even higher gross return. Of course the gross return of someone who dollar cost averaged in to the S+P since mid 93 would be less then 80% , but the gross return of someone who DCA's in to a 6% fixed yield investment would be less then 32%. Also the 6% fixed yield investment would not experience the main advantage from DCA. When you DCA into a stock or stock fund you buy more shares when the price is lower and less when the price is higher. IF the fixed investment is a CD or something like that then you don't benefit from price DCA because there is no price fluctuations. If it is a bond you get price fluctuations but probably less then with stocks and also the fluctuations of the bond price mean that you no longer really have a straight 6% annual return because when you buy and sell the bond or bond fund effects your actual return. I think your point, that DCA'ing into the S+P hasn't achieved the kinds of results that BGR was claiming (13%) is correct, but while the tactic hasn't done as well as BGR claimed it did, it has done better then your posts suggest it did. Your point is right but your supporting data seems to be inaccurate and misleading. Tim