Value Averaging (VA) is an investment strategy designed to systematically grow the value of an investment portfolio over time by making periodic contributions or withdrawals based on a predetermined growth target. Unlike Dollar Cost Averaging (DCA), which involves investing a fixed amount at regular intervals, VA adjusts the contribution amount depending on market performance. If the portfolio performs well and exceeds the target value, the investor contributes less—or may even withdraw funds. Conversely, if the portfolio underperforms, the investor increases the contribution to stay on track with the growth plan. This method leverages market fluctuations to buy more shares when prices are low and fewer shares when prices are high, aiming to optimize returns while maintaining discipline. However, VA requires consistent monitoring and may involve larger contributions during market downturns, making it best suited for investors with sufficient resources and a commitment to their investment goals. To see it in action, the simulator uses real-world data, including the weekly opening prices of Bitcoin, the SPDR S&P 500 ETF (SPY) and Gold, giving you a clear picture of how this strategy works in action.
In this simulator: the negative investment indicates your withdraw amount.