Why I Will Dollar-Cost Average Every Investment Going Forward
It’s the best way to make money
I used to think I was knowledgeable about stocks, markets, and finance. I soon realized that “knowledge” didn’t help for shit.
After making a few safe investments that worked out, staying up to date with the market, and going to school for finance, I thought I knew what I was doing. I started getting cocky with trades and not listening to those with more experience. And my losses reflected that.
Then I found the solution to it all, Dollar-Cost Averaging. It's a strategy so simple yet so great.
Dollar-cost average (DCA) is when you slowly buy into a position. It can be over hours, days, months, or years. It all depends on your horizon and strategy.
You can dollar cost average based on time, percentage change, or anything really. If you’re investing for retirement you might buy one share of stock “X” on the first of every month. If you’re day trading you might buy-in through the first three hours of the day whenever the price drops half a percent.
The benefit of dollar-cost averaging is that you spread out your purchases so you won’t get caught buying high. You also won't benefit from buying low. But if you buy-in consistently, it should even out between highs and…
