Finance & Fury Podcast

Welcome to Finance and Fury. This episode will be explaining the dollar cost averaging strategy. It seems to be a pretty simple strategy – but one hard to get right – so want to run through it and when to use it in further detail What is a dollar cost averaging strategy – DCA for short It is breaking up investment timing - Dollar-cost averaging (DCA) is an investment strategy in which an investor divides up the total amount that they wish to invest across periodic purchases The aims of this is to reduce the impact of volatility on the overall purchase of investments in the short term It is the concept of taking out the short-term probability of market volatility from investment decisions It is a hard question – when to purchase an investment – today, tomorrow, or wait a few weeks and hope the price goes down The concept of DCA is to take this short-term guessing game out of the equation – if the market does down next month then great – through doing DCA you are picking up more investments at a lower price