Is dollar-cost averaging a good investment strategy?

Asked 3 years ago

What are the benefits of dollar-cost averaging?

Andrew Moran

Sunday, October 17, 2021

If you are a long-term investor, dollar-cost averaging (DCA) is the best investment strategy you can employ.

Here are just some of the benefits of DCA:

  • Avoid the volatility of the stock market and take advantage of the highs and lows.
  • You do not need to time the market.
  • The emotion and stress are gone because you have a predetermined time and amount to invest.
  • Vast lump sums are unnecessary when buying stocks.

The only possible setback is that, because the stock market rises over time, investing smaller amounts over a period could risk losing additional capital gains.

Aside from that, pick a couple of stocks you want to hold forever and DCA moving forward.





Write an answer...

Cancel

Please follow our  Community Guidelines

Can't find what you're looking for?