Dollar-Cost Averaging (DCA)
Investing a fixed amount on a regular schedule, regardless of price.
Dollar-cost averaging means investing the same amount at regular intervals — say, $500 every month — instead of trying to time the market with one lump sum. Because the fixed amount buys more shares when prices are low and fewer when prices are high, it smooths out the average purchase price over time and removes the need to guess when to invest.
Worked Example
Investing $500/month for a year buys more shares in months the market dips and fewer in months it's expensive, averaging out to a purchase price that's rarely the best or the worst possible entry point — just a steady, unemotional one.
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