All terms
Buying a fixed amount on a schedule instead of all at once.
DCA means committing to buy, say, 100 dollars every week regardless of price. You buy more units when price is low and fewer when it is high, and your average entry smooths out.
Its real benefit is behavioral. It removes the need to be right about timing, which is the thing almost nobody is consistently good at.
Most exchanges including Coinbase let you set a recurring buy. Setting it once and leaving it alone beats most active attempts.
That dollar cost averaging guarantees a profit. It removes the timing decision and the regret that comes with it, and it does nothing about whether the asset was worth buying. Averaging into something going to zero is still going to zero.
Common questions
Does dollar cost averaging beat buying all at once?
How often should I buy?
Where this comes up on the site
The guides that actually use this word, rather than a list of everything we have written.
Where to go next
More trading terms
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