Dollar (Steer) Cost Averaging Explained - KISS Principle

I used to be a financial planner and you would not believe how such a simple concept confusing so many people.

I'm talking about Dollar Cost Averaging.

You can explain it every which way on how it relates to stocks or stacking gold and silver, most people still look at you like you got a third eye..........Not good.

So in the name of simplicity, I'm now going to make you all cattle ranchers........Ready

Each rancher has a total investment of $600. Rancher Bob will invest $100 per month and buy as many steer per month, no matter what the price. Rancher Earl, he is anxious to start his business and spends the entire $600 at the start of the season. Steers cost $100 per steer on Month 1,

Month 2 arrives, the dry season continues and feed is costing more to feed the steers so the price per steer drops to $50 a head. Continuing with this strategy, Rancher Bob now buys two steer, Rancher Earl spent his entire investment, but he still has 6 steer, laughing at Rancher Bob, because he only has 3 steer.

Month 3 arrives,

Oprah starts a new diet and it is a beef free diet. The price of beef drops, including the price of steer, now $25 a head. Rancher Bob can now buy 4 steer and adds it to his ranch. Earl, looking over, starts to get a bit jealous, as Bob now has 7 steer.

Month 4 arrives, the scare has now turned to Mad Cow Disease, but the herd is not effected but the price stays at $25 a head, Rancher Bob puts his $100 investment and buys 4 more steer. Rancher Earl looks over the fence and sees 11 head of cattle, while he continues to watch his 6 steer graze in the sunset.

Month 5 arrives, Oprah can never keep a diet so switches to the Atkins Diet and the price beef rises, causing the price of steer to jump back to $50 a head. Rancher Earl is a bit happier as his steer are getting larger and it's almost time for the steer processor to do his work. Bob is a little disappointed as he can only purchase 2 steer this month buy continues with his $100 a month strategy. Rancher Bob now has 13 head of cattle.

Month 6 arrives, the price of steer rise and Rancher Bob spends his last $100 and buys one steer. Somewhat disappointed but sees 14 head of cattle on the ranch. Rancher Earl, happy that the price returned to break even, but at least he didn't lose money over the last 6 months. The steer are ready for the steak factory, let's see the results.

Rancher Bob $1400
Rancher Earl $ 600

Wither its Steer or Silver, in a fluctuating market, even if the price returns to the same price, over the long run, investing a set amount of fiat currency aside each month will net you more ounces to the stack in the long run.

Hope you enjoyed my story and be free to use it next time you need to explain to a investor, that dollar steer averaging in an effective strategy in a fluctuating market.

Keep stacking. Go get you some.

Thanks for following @RollingThunder