The strategy
How to invest $10,000 using a three-dip plan
Buy with a plan, not in a panic. This beginner guide explains Alejandro Salomon's dip-buying approach using the supplied summary of his video, “Tengo que compartirte MIS SECRETOS de inversión.” Here is a $10,000 example, step by step.
By SplitDip2 min read
Key takeaway
Keep cash aside. Split your investment budget into three equal buys. Wait for your prices, without assuming the market must recover.
Simulator preview · $10,000 budget
See what your money could become
Fictional 4-month example, not a forecast. The full simulator uses past market rebounds, so its results will differ.
Three equal buys at 10%, 20%, 30% below the starting price
$10,000 could become $12,632
+$2,632 (+26.32%) after month 4
Try $10,000 in the full simulator| Strategy | Ending value | Gain or loss | Return |
|---|---|---|---|
| Three dip buys3 of 3 buys filled | $12,632 | +$2,632 | +26.32% |
| Buy monthly | $11,974 | +$1,974 | +19.74% |
| Invest all at once | $10,000 | $0 | 0.00% |
What if the market takes a different path?
Prices only riseThree dip buys 0.00%Buy monthly +22.91%Invest all at once +40.00%
| Strategy | Ending value | Gain or loss | Return |
|---|---|---|---|
| Three dip buys0 of 3 buys filled, $10,000 cash | $10,000 | $0 | 0.00% |
| Buy monthly | $12,291 | +$2,291 | +22.91% |
| Invest all at once | $14,000 | +$4,000 | +40.00% |
Prices keep fallingThree dip buys -24.21%Buy monthly -28.15%Invest all at once -40.00%
| Strategy | Ending value | Gain or loss | Return |
|---|---|---|---|
| Three dip buys3 of 3 buys filled | $7,579 | -$2,421 | -24.21% |
| Buy monthly | $7,185 | -$2,815 | -28.15% |
| Invest all at once | $6,000 | -$4,000 | -40.00% |
How we calculated this
- Each strategy has the same $10,000 available at month 0, in the same fictional investment, valued at the same month-4 price.
- Buy monthly invests one quarter at months 0, 1, 2 and 3. Invest all at once buys everything at month 0.
- Three dip buys invests one third when the price reaches 90, 80, 70 from a start of 100. Unused cash is counted in the final value.
- Fractional units. No interest on cash, fees, taxes, dividends or slippage.
- Exact fills at trigger levels assume prices move continuously; real markets can gap past a level.
- Sell targets are not applied; positions are simply held to month 4.
- A dip, then a recovery: prices at months 0–4 are 100 → 90 → 80 → 70 → 100.
- Prices only rise: prices at months 0–4 are 100 → 110 → 120 → 130 → 140.
- Prices keep falling: prices at months 0–4 are 100 → 90 → 80 → 70 → 60.
1. Separate your cash from your investment
The summary describes a 50/50 split: half in cash, half invested for several years. With $20,000, that would leave $10,000 for three buys and $10,000 in cash. This allocation is the author's suggestion, not a rule for everyone. Protect emergency savings and near-term bills first.
2. Choose a fund you understand
The video discusses the S&P 500, Nasdaq and Dow instead of picking individual companies. These are indexes, not investments you buy directly. Research a low-cost fund that tracks your chosen index. Check its holdings: Nasdaq funds can be concentrated, and not every fund tracks the Nasdaq Composite.
3. Set three prices before buying
Divide $10,000 into roughly $3,333 per buy. The summary's levels are 20%, 25% and 30% below the same reference high. If your ETF's reference price is $100, your buy prices are $80, $75 and $70. Each drop is measured from $100, not from the previous buy.
Use the ETF's own prices for orders, not index points. If only the first level is reached, buy only that portion. The rest stays in cash. A lower price is not proof that an investment will recover.
4. Test it against buying monthly
The preview compares returns with monthly buying and investing all at once. Its example uses 10%, 20% and 30% drops, not the video's 20%, 25% and 30%. Check rising and falling paths too: waiting can miss gains, and buying dips can still lose money.
Risk note: The simulator's sell range and recovery-time estimate are added modeling assumptions, not exit rules established by the supplied video summary. Neither is a promise. This is education, not a personal investment recommendation.
Try it in SplitDip
Explore a $10,000 plan. Check the buy levels before comparing outcomes.
Open the simulatorEducational content from SplitDip. It is general information, not financial, tax or legal advice, and not a personal plan. Investing involves risk, including the loss of money.
Sources
- 1.Alejandro Salomon: Original video — three staged buys (22:43); article based on the supplied summary (opens in a new tab)
- 2.Original video: Cash allocation discussion (7:36) (opens in a new tab)
- 3.Investor.gov: Dollar Cost Averaging (opens in a new tab)
- 4.Investor.gov: Index Funds (opens in a new tab)