How to evaluate CD DAC vs. outboard DAC quality


I have a Cambridge Audio Azur 840C CDP that received positive reviews upon is release. If, as I keep reading, DACs have advanced by leaps and bounds over the past several years, I have to wonder if adding an outboard DAC would improve the overall sound quality. My audio goal is always the same: greater musical realism!

So the question is: How can you know whether a recently released DAC (say around $1000-$1500) will be a useful add-on? I'm not looking for the flippant and unhelpful try-it-for-yourself-and-see response. I'd genuinely like to know A) whether modern-day DACs really are superior to those from five or ten years ago, and B) whether someone with a large CD collection and no interest in computer audio is better off forgetting about a DAC and investing instead in a better CDP, like Ayon or the like.

Thanks!
recroom
I was using a Sony 5400 as my digital source. Then purchased an Audio Note Kit Dac 2.1b for $1750 using the Sony as a transport. Major inprovement over the Sony especially in information retrieval and frequency extension. I have now replaced the Sony with an Audio Note CDT Two/II transport. Another major improvement proving to me that the transport is just as important as the dac
Alan
I agree with Elizabeth. Newer isn't akways better and there are other factors involved in how a dac sounds besides the chip used. It's like a quality 100 watt amp sounding better than a crappy one that's rated at 1,000 watts. I can't hear a difference between my parasound z-dac (which got and is getting rave reviews? And my musical fidelity a3.2 cd player (that got ok reviews). Buy a dac that you can return once you've heard it then you can decide for yourself!
Although one may experience improvements from one DAC to another, they are usually quite small and subtle. The best chance to enhance that "greater musical realism" you've requested is to buy much better speakers than what you're currently using.
Recroom,

I have the same question as you regarding DAC vs CD and am to this point:

I decided that I like to touch and read about my music rather than listen from a computer which I more readily associate with either work or mindless entertainment.

That being said, I have an Audio Space CDP 8A with tubed front end that I like. It is smooth with quite a bit of detail but my Technics table with AT 150 cart beats it hands down because vinyl sounds more "live" in my setup.

All the reviews talk about needing to be in the $5K and up league to get the "live" performance from a CD player.

So.... off I go to the audio store and listen to an Esoteric for $6K and an Electrocompanient for about the same price.

Sort of waste of time, because while I could certainly tell a difference between the two units, played through maggie 1.7's by the way, I could not tell that either sounded better than what I already had.

The store was open to letting me bring in my player to compare to the Esoteric and Electrocompanient through maggie 3.7's (I have 3.6's).

That seems like a good way to proceed.

And the store claims to be willing to let me take home one of the players if my in store listening test indicates that i like the sound of one more than my cd player.

So...does this all make sesne - forget the opinions and listen yourself. $5K or $1K is a lot of money and unless you can give it back you are screwed on new gear.
sorry - I hit submit instead of preview first.

Did not want to sound dogmatic, but given the cost of this hobby, hearing is believing.

Oherwise, it is a bet where the best odds are that we are 50% wrong and it goes further wrong from there if we miss hearing a less expensive piece that sounds better than our new toy that we think is the best.

Please let me know where I have missed the point.