Back to Investing 101
Lesson 12 6 minute lesson Interactive
Dollar-Cost Averaging
Learn how regular contributions can reduce the pressure to guess the perfect day to invest.
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Lesson goal
Explain how a consistent schedule behaves when market prices move up and down.
Three ideas to keep
1
Invest a set amount on a schedule
2
Lower prices buy more shares
3
Consistency does not remove market risk
Try it
Make the call
You invest the same amount each month and prices fall this month. What happens?
Knowledge check
Lock it in
What problem does dollar-cost averaging mainly reduce?
Finish both activities