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Article: MONEY SENSE.(dollar cost averaging)(Brief Article)(Statistical Data Included)
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- Manage
- Article date:
- May 1, 2001
- Author:
CopyrightCOPYRIGHT 2001 National Management Association. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Dollar Cost Averaging Can Reduce Effect of Volatile Markets
People often delay investing because they fear acting at just the wrong moment, when the markets are spiking and prices are high, for instance, or the market is down and prices are dropping. Investing gradually can be an effective way to overcome the uncertainty about whether or when to invest.
Many investors reduce the effects of market volatility by investing at regular intervals using a technique called dollar cost averaging. Dollar cost averaging is a time-tested strategy that has the potential to help you earn attractive risk-adjusted rates of return.
How Dollar Cost Averaging ...