A Great Way To Get Paid During a Bear Market
The stock market has had a great run recently, and I’m happy to say many of us are sitting on some serious gains.
But what if you missed the boat? Or what if you’re worried that a major drop is imminent and don’t want to put any new money to work? Or what if you are only just at the point where you have some money to start investing?
I recommend you consider dollar-cost averaging.
The idea of dollar-cost averaging is relatively simple. You buy equal dollar amounts of the same investment on a predetermined schedule.
Please note that dollar-cost averaging is not buying a fixed number of shares on a regular basis. In fact, it is quite the opposite. And here’s why…
Let’s say you’ve decided to invest $10,000 in ABC Corp. And rather than deploying the entire amount at one time, you might instead opt to
purchase $1,000 of ABC stock on the first day of each of the next 10 months.
What’s the logic behind this approach?
Well, you can expect just about any stock’s price to vary substantially over a 10-month period. So, when the price is higher, your $1,000 will buy fewer shares; when the price dips, your $1,000 will buy more shares.