Invest What You Can, When You Can

An important part of investing is setting out a long-term strategy to follow. But is dollar cost averaging the best way to ease yourself in?

Jamie O’Donoghue
Jun 7 · 6 min read

Dollar Cost Averaging?

Dollar cost averaging (DCA) is an investment technique that allows you to spread your investments out over a long period of time rather than making a few lump-sum investments. Typically, people tend to think of stock investing as using a lump-sum of cash to buy an entire portfolio of stocks in one go. With dollar cost averaging, however, you simply add a small amount of money to your portfolio every so often (usually weekly or monthly) and build up your investments gradually.

Types of Dollar Cost Averaging

There are three primary types of dollar cost averaging: Basic DCA, Value DCA, and Momentum DCA.

Why use Dollar Cost Averaging?

So what are the benefits of dollar cost averaging?

Does Dollar Cost Averaging work?

Various studies have been conducted into the efficacy of dollar cost averaging, and by-and-large they have proven that investing a lump-sum tends to be more profitable.


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Jamie O’Donoghue

Written by

Content Specialist at MyWallSt

The MyWallSt Blog

Investing is for everyone, we show you how. MyWallSt is a multi-award winning company that helps you to become a confident and successful investor.