What is dollar cost averaging?

Dollar cost averaging (DCA) is one of the automated investment management tools that facilitates regular investments from your client’s Wrap cash account into:

  • certain managed investments
  • Seperately Managed Accounts (SMAs).

DCA isn’t available for:

  • Australian and international listed securities
  • term deposits
  • non-daily priced funds.

Check if your client has a DCA plan

You can only have one automated investment plan on an account at a time. To see if your client has an existing DCA plan:

  1. Log into Adviser Online
  2. Search for your client
  3. Select the Wrap account from Client Overview
  4. Select Account Details
  5. Click on the Features tile where you can find the details of any current DCA plan.

Set up a DCA plan

  1. Log in to Adviser Online
  2. Search for your client 
  3. Select the Wrap account from Client Overview 
  4. Select Account Details 
  5. Click on the Dollar cost averaging symbol to open the accordion 
  6. Click on Add dollar cost averaging within the features tile 
  7. Click Enter or maintain dollar cost averaging 
  8. Select the frequency 
  9. Enter the total amount per payment (in whole dollars) 
  10. Enter a final payment date or select Until further notice 
  11. Select the security or securities you want to apply DCA to and the amount per payment 
  12. Click Update to confirm your changes. 

Authorising a DCA plan

New plans or updates to existing plans won’t be saved until authorised by you or by associates in your office with full transact authority. A pending status indicates the plan hasn’t been authorised.

When setting up a DCA plan for a retail client, you’ll need to confirm that personal advice has been given recommending that the account holder/s invest in each of the products within the DCA plan.  

Cancel a DCA plan

  1. Log in to Adviser Online
  2. Search for your client
  3. Select the Wrap account from Client Overview
  4. Select Account details
  5. Click on the Dollar cost averaging chevron to open the accordion
  6. Click on Add dollar cost averaging within the features tile
  7. Click Enter or maintain dollar cost averaging
  8. Select the DCA plan to be cancelled and deleted
  9. Click Delete
  10. Click Authorise on the next screen to delete the selected DCA plan.

Requirements and timing for DCA transactions

Minimum transaction amount

The minimum transaction requirement for DCA is $50 per managed investment or SMA. 

Sufficient cash balance

DCA won’t run if the minimum cash balance is insufficient. You’ll receive an alert if your client’s DCA plan fails due to insufficient cash. Read more about alerts for your clients.  

When DCA transactions occur

DCA transactions will occur on or around the 16th of the month (though this date may change without prior notice). If there’s enough cash, the DCA will occur, and the cash will be debited the next business day after the order is placed. When the 16th of the month falls on a weekend, DCA will generally occur the first business day after the weekend.

Was this helpful?
 

If you have any feedback on this article or need
additional support, please contact us via live chat
or email service@wrapinvest.com.au.