
What is dollar-cost averaging?
Dollar-cost averaging(DCA) is an investment strategy that involves investing a fixed amount of money at regular intervals, regardless of the price of the investment. The idea behind this strategy is to reduce the impact of volatility on the overall cost of the investment by buying more shares when the price is low and fewer shares when the price is high. This can help to minimize the risk of buying at the top of a market cycle and reduce the overall cost of the investment. Dollar-cost averaging is a popular strategy for investing in volatile assets such as cryptocurrency, and it can be used in combination with other investment strategies such as value investing or momentum investing. It is also known as the constant dollar plan(CDP)
Jan 17, 2023 18:10