DCA Into Nasdaq 100 at the 2000 Dot-Com Peak: A 26-Year Backtest
DCA Into Nasdaq 100 at the 2000 Dot-Com Peak: A 26-Year Backtest What happens if you start dollar-cost averaging (DCA) into the Nasdaq-100 at the worst possible moment—the peak of the dot-com bubble in March 2000? Most people assume it would be a disaster. The data says otherwise. The backtest setup I ran a DCA backtest on QQQ (Nasdaq-100 ETF) with the following parameters: Asset: QQQ Period:…
In 2000, the Nasdaq-100 reached its peak during the dot-com bubble, with a closing value of 4,816. A 26-year backtest of dollar-cost averaging (DCA) into the Nasdaq-100 ETF (QQQ) from March 1, 2000 to August 31, 2026 illustrates that starting DCA during this peak can still yield significant returns. The backtest involved a fixed monthly contribution of $1,000, excluding dividends and fees, and showed a final value of $1,943,131.91 on a total investment of $318,000.
This translates to a total return of 511.05% and an annualized return of 11.77%. The maximum drawdown during this period was 40.11%, a less severe decline than a lump sum investment would have experienced. DCA's "buy low, sell high" strategy allowed for cheaper shares during the downturn, which paid off during the recovery. Compared to the S&P 500, the Nasdaq-100 suffered a more severe decline (-82.9% vs. -49%) and a longer recovery time (15 years vs. 7 years).
However, DCA still managed to break even within 10 years and deliver a total return of 511.05%, demonstrating the power of consistent investing even during extreme market downturns.
Written by urgent.news from Dev.to's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
