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Curious Cat Investing Dictionary: Dollar Cost Averaging

Dollar Cost Averaging - An investment strategy to invest an identical dollar amount at set time intervals. For example, investing $100 each month in a mutual fund. This strategy results in you purchases more shares when the price is low and fewer when prices are higher (because the same dollars buy more shares when the price is lower and visa versa).

Similar terms: Dollar Cost Average, Average In, DRIP

Related terms:

Total Return

Online Resources:

Slow and steady wins the race by Selena Maranjian, May 2002, fool.com.
Fundamentals of Dollar-Cost Averaging, by Peter Di Teresa, Oct 2002, morningstar.com.
Dollar-Cost Averaging from Vanguard.
Saving for Retirement by John Hunter

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