Do you have a lump sum you can leave invested for 10 years or longer? Then you typically have two options: invest it all at once, or invest step by step (for example, spread over six months).
What usually leads to the highest return?
Historically, investing all at once has more often resulted in the highest ending value on average. Put simply: your money becomes fully invested sooner, and markets tend to rise more often than they fall over the long term.
Can step-by-step investing sometimes be better?
Yes. If the market drops shortly after you start, step-by-step investing can work out better, because you’ll be buying (on average) at lower prices over time.
Which option suits you?
Investing all at once is usually a better fit if you have a long time horizon, stay calm during market ups and downs, and are not likely to stop investing if markets fall.
Step-by-step investing is usually a better fit if you find it stressful to invest everything at once and mainly want an approach that helps you stick with your plan.
A smart middle ground
Many people choose to invest step by step over a short period (for example, six months). This can reduce “entry timing stress” without leaving too much money on the sidelines for too long.
Sources
Vanguard (2023). Cost averaging: Invest now or temporarily hold your cash?
Morningstar (2025). Dollar cost averaging vs lump sum investing.
Important: Investing involves risks. The value of your investments can go up or down, and you may lose part of your initial investment. Past averages are not a guarantee of future results.