DCA calculator for gold and silver
Short answer: Dollar-cost averaging means buying a fixed amount every month, so you get more metal when the price is low and less when it is high. The average spot price you bought at is always at or below the simple average of the monthly prices, because the cheaper months buy more ounces.
How to use it
- Enter the amount you would buy each month and the premium over spot you usually pay.
- Enter the spot price per troy ounce for each month. Use real past prices, or test your own scenarios.
- Read the metal you would have bought and your average price per ounce.
- Compare the average spot price you bought at with the simple average of the monthly prices to see the effect of buying a fixed amount. The premium is shown separately in your average price paid.
Formula: average price paid = total spent ÷ total troy ounces bought
Questions
Does dollar-cost averaging always beat buying all at once?+
No. If the price rises steadily, buying everything at the start would have cost less. DCA reduces the risk of buying at a bad moment, and it does not guarantee a better result.
Why is the average spot price I bought at below the simple average?+
Because a fixed amount buys more ounces in cheap months, so cheaper months carry more weight in your average. Your average price paid is higher than that because it includes the premium.
Should I include the premium?+
Yes. The premium is part of what you pay, so including it gives a realistic average price per ounce.
Can BullionKeeper plan this for me?+
BullionKeeper includes DCA plans that let you set a regular purchase and see how your average cost moves as you buy.
Related
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