Dollar-Cost Averaging
Dollar-Cost Averaging is an investment strategy where an individual invests a fixed amount of money at regular intervals, regardless of the asset's price. This approach helps reduce the impact of market volatility, as it allows investors to buy more shares when prices are low and fewer shares when prices are high. Over time, this can lead to a lower average cost per share.
By consistently investing over time, Dollar-Cost Averaging encourages disciplined saving and can help investors avoid the pitfalls of trying to time the market. This method is often recommended for long-term investors looking to build wealth gradually while minimizing risk.