What Is Dollar-Cost-Averaging: Is It the Best Way to Invest?

For many of us, emotions and stress levels play a role in constructing our investment portfolio, making dollar-cost-averaging a legitimate strategy.

Dollar-cost-averaging (DCA) is a systematic program of investing equal sums of money at regular intervals regardless of the investment’s price.

What is Dollar-Cost-Averaging?

This strategy provides a disciplined approach, taking the guesswork out of investment timing and avoiding the outside events that may cause short-term gyration in the market.

You’re Probably Already Using the DCA Approach

Reduces Risk The DCA approach minimizes risk and is desirable for investors with low-risk tolerance.

Benefits of Dollar-Cost-Averages

Investors are making purchases at regular intervals and fixed amounts instead of poorly timed lump sum investments.

Investor Discipline

Investors will buy more shares at a fixed amount when the market goes down.

Help You Lower Your Cost Basis

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