Dollar-Cost Averaging
Investing a fixed amount at regular intervals regardless of price.
What is Dollar-Cost Averaging?
Dollar-cost averaging is a strategy of investing a fixed sum at regular intervals rather than all at once, so more units are bought when prices are low and fewer when prices are high. This smooths out the average purchase price over time and reduces the impact of trying to time the market. A related idea, averaging down, means buying more of a falling asset to lower the average cost per unit.