Results from this calculator should not be taken as any kind of investment advice. “Optimal” refers only to solving a particular mathematical problem based on constant rates of return and cannot predict or take into account the actual future movements in financial markets. Every individual situation is different and you should consult a qualified financial planner and/or tax accountant.

This calculator is designed for the situation in which you receive a regular salary (e.g. each fortnight) and set aside some for investing in a parcel of shares. However, if you have to pay brokerage on every parcel then it may be better to keep that money aside in a savings account until you have saved for a larger parcel. Invest too often and you’ll pay too much brokerage. Don’t invest often enough and you’ll miss out on (higher) returns from the market. This calculator is designed to find the optimal frequency to maximise long-term returns based on the input parameters and assumptions.

The mathematics used to calculate this were written by me (codebeard) and first appeared at the Money StackExchange (go here to see all the details). I have a PhD in mathematics and am interested in personal finance.

There are a couple of common approaches for this situation: If you are trying to keep your investment portfolio aligned with some target portfolio (e.g. 70% A, 30% B), then one approach is to just invest each time in whichever single share is furthest under the target at that point. The other approach would be if you have a fixed amount you want to invest in each share per saving period, in which case you should just use the calculator once for each share, for example with $100/fortnight for A and then with $200/fortnight for B.

I am not an accountant or financial adviser – please see a professional. For general discussion on finance and investment, you can find many helpful forums online.

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