%0 Journal Article
%A Wai Mun Fong
%T Beating the Market: Dollar-Cost Averaging with the
Profitable Dividend Yield Strategy
%D 2017
%R 10.3905/jwm.2017.20.2.054
%J The Journal of Wealth Management
%P 54-66
%V 20
%N 2
%X Extensive evidence shows that lump sum investing (LSI) beats dollar-cost averaging (DCA) in most stock markets. We show that DCA investors are not doomed to inferior returns. Motivated by the clean surplus accounting model of asset pricing, we consider a DCA strategy that invests in stocks with a high gross profits-to-asset ratio and high dividend yield. Using block bootstrap simulations of long-horizon (20-year) returns, we show that this profitable dividend yield strategy significantly outperforms LSI in the market index in many dimensions.TOPICS: Security analysis and valuation, simulations, performance measurement
%U https://jwm.pm-research.com/content/iijwealthmgmt/20/2/54.full.pdf