Advertising

Dollar cost averaging

• Is the practice of purchasing securities at periodic intervals with fixed dollar amounts regardless of market conditions. The investor does not intend to purchase an equal number of shares at each interval.

• Systematically investing the same amount of money in the same stock or group of stocks.

• A technique of buying a fixed dollar amount of a particular investment on a regular schedule, regardless of the share price; thus purchasing more shares when prices are low, and fewer shares when prices are high. Over time, the average cost per share of the security will become smaller. This method attempts to lessen the risk of investing a large amount in a single investment at the wrong time. Used with Mutual Funds and Dividend Reinvestment Plans.

 
 

Follow this link for all the terms related to cost.

 
 Embedded terms in definition
 Average
Dividend reinvestment plan
Dividend reinvestment
Dividend
Investor
Market
Mutual funds
Mutual fund
Prices
Purchase
Reinvestment
Risk
Securities
Security
Shares
Share
Stock
Time
Will
 
 Related Terms
 

<< Dollar bonds Dollar duration >>

Ways to Cope Financially During and After a Big Change: Here are suggestions for staying focused and avoiding costly decisions during changing times. More...

The best way to inspire people to superior performance is to convince them by everything you do and by your everyday attitude that you are wholeheartedly supporting them. - Harold S. Geneen

Advertising



Copyright 2009-2019 GVC. All rights reserved.