Dollar Cost Averaging (DCA) is one of the smartest, easiest investment strategies for beginners. It involves investing a fixed amount of money at regular intervals, regardless of the asset’s price at that time. By doing this, you reduce the risk of making a big investment when prices are high and increase your chances of buying more when prices are low.
For example, instead of investing $1,000 all at once, you might invest $100 per month over ten months. When prices are high, your $100 buys fewer shares, but when prices are low, that same $100 buys more. This smooths out the average cost of your investments over time.
