Historical Best Day of Month to Dollar Cost Average or Invest: UPDATED: 1950 to 2014

Historical Best Day of Month to Dollar Cost Average or Invest: Updated: 1950 to 2014

This article updates the previous "Best Day of Month to Dollar Cost Average".



1. This article now covers February 14, 1950 up to July 8, 2014.



2. The previous article used the Average S&P 500 methodology, which over weighed the S&P 500 when it is large (over 1500), and under weighed the S&P 500 when it was small (around 20 on the S&P 500 in 1950).



3. This article uses the "Percent Above 30 Trading Day Moving Average" methodology.   This way, whether the S&P 500 had a low value or high value, the results have equal weight.



4. To determine the best day of month to dollar cost average, choose the lowest "percent above 30 trading day moving average" value.



Chart:

The Results:

The best two days of the month to dollar cost average are on the 26th (#1) and 25th (#2) with the lowest value of percent above 30 trading day moving average.

#3a: 19th    (0.20%)
#3b: 27th    (0.20%)
#4a: 10th    (0.22%)
#4b: 24th    (0.22%)

The rest of the values can be seen in the chart above.

Beginning of the Month Boost:

At the beginning of the month, the percent above 30 trading day moving average seems to be at its highest values.

One possible reason why is because of investment in 401k and retirement funds close to the beginning of the month, which pushes the S&P 500 up during this time.

Historical Best Day of Month To Invest or Dollar Cost Average in the S&P 500 from 1950 to 2007

Many people have adopted a Dollar Cost Averaging Strategy of regularly investing in a mutual fund, such as an S&P 500 Index Fund. Often, brokers could give the user an option when they automatically invest the money. Investors could choose which day of the month they can dollar cost average.

Will an investors choice of day to invest on a regular basis affect overall return?



In the Chart Above, we have averaged the S&P 500 Closing Average from 1950 to August 2007 given a particular day of month.

We notice that the 19th of the month has the lowest S&P 500 average, suggesting that the 19th of the month during this 1950 to 2007 period is the best day of the month to dollar cost average. The 4th and 11th are the next runners up.

The worst days to invest are the 22nd, followed by the 7th, 8th, 31st, and 20th.

More Data

Day of Month and S&P Average Close:

1. 1 =427.79
   
2. 2 =423.92
   
3. 3 =425.97
   
4. 4 =417.92
   
5. 5 =425.40
   
6. 6 =423.93
   
7. 7 =429.16
   
8. 8 =428.80
   
9. 9 =425.51
   
10. 10 =421.28
    
11. 11 =418.35
    
12. 12 =425.22
    
13. 13 =423.64
    
14. 14 =422.36
    
15. 15 =421.07
    
16. 16 =425.35
    
17. 17 =420.41
    
18. 18 =419.70
    
19. 19 =416.94
    
20. 20 =428.42
    
21. 21 =422.16
    
22. 22 =433.34
    
23. 23 =425.31
    
24. 24 =425.00
    
25. 25 =419.48
    
26. 26 =424.77
    
27. 27 =425.30
    
28. 28 =423.34
    
29. 29 =418.86
    
30. 30 =427.28
    
31. 31 =428.42
    

Data Ordered by Average S&P 500 Close

Day of Month S&P Close:

1. 19 =416.94
   
2. 4 =417.92
   
3. 11 =418.35
   
4. 29 =418.86
   
5. 25 =419.48
   
6. 18 =419.70
   
7. 17 =420.41
   
8. 15 =421.07
   
9. 10 =421.28
   
10. 21 =422.16
    
11. 14 =422.36
    
12. 28 =423.34
    
13. 13 =423.64
    
14. 2 =423.92
    
15. 6 =423.93
    
16. 26 =424.77
    
17. 24 =425.00
    
18. 12 =425.22
    
19. 27 =425.30
    
20. 23 =425.31
    
21. 16 =425.35
    
22. 5 =425.40
    
23. 9 =425.51
    
24. 3 =425.97
    
25. 30 =427.28
    
26. 1 =427.79
    
27. 20 =428.42
    
28. 31 =428.42
    
29. 8 =428.80
    
30. 7 =429.16
    
31. 22 =433.34
    

Previous Look at Return by Day of the Month

Kiplinger Article on best Day of Month to Invest

The Average Method

The Averaging Method above is only an approximation. We do realize that S&P 500 index values that have a high value overshadows the days when the S&P 500 had much lower values.