Dollar Cost Averaging
How to invest when i am not financially savvy?
If i have no time to monitor can i still invest?
But what if i have no lump sum or big capital to invest?
There is good news for all of you who have those issues mentioned above but are still keen on investing. Dollar cost averaging is an approach of investing in a consistent manner.
It is a timing strategy of investing equal dollar amounts regularly and periodically over specific time periods (such as$100 monthly) in a particular investment or portfolio. By doing so, more unit shares are purchased when prices are low and fewer unit shares are purchased when prices are high. The point of this is to lower the total average cost per share of the investment, giving the investor a lower overall cost for the shares purchased over time.
The illustration above explains the cheaper the price of a unit share the more units that can be gathered. Continue to gather units and simply sell back at the original price it could already possibly be doubled. What more if the price climbs up and you give it more time?
Although by doing so we might not achieve the highest potential returns however we can actually safe the trouble monitoring them intently.
Furthermore the longer you invest, the higher the chance that you will receive positive returns and lower the chance that you will lose money.
One Comments to “Dollar Cost Averaging”
На мой взгляд тема весьма интересна. Предлагаю всем активнее принять участие в обсуждении….
But what if i have no lump sum or big capital to invest? There is good news for all of you who have those issues mentioned above but are still keen on investing…..