Skip to main content
Glossary
Investing Basics
beginner

Dollar-Cost Averaging

Investing a fixed amount on a regular schedule, regardless of price.

Also known as
DCA

Dollar-cost averaging (DCA) means investing the same fixed amount at regular intervals — for example, monthly — no matter what the price is at the time. This buys more units when prices are low and fewer when prices are high, smoothing the average cost paid over time.

Its main benefit is behavioral: it removes the pressure of trying to time the market and keeps an investor contributing through both downturns and rallies.

Related Terms