Dollar Cost Averaging – an investment strategy

Dollar Cost Averaging is a great way to heal the blows that Bear has done. Choose an investment and add a fixed amount of money every month, without fail!, Although the market is sick. Generally, your average cost per share will be lower.

Although investing in a mutual fund or individual stocks, you will be participating in the market constantly, instead of trying to buy at the time "right." Using Dollar Cost Averaging , you automatically will be buying fewer shares when the price is high and more shares when the price is low. The goal of Dollar Cost Averaging is to get a lower price per share.

Investing in a perfect spot market is extremely difficult and requires to be constantly watching what happens in the stock market. The reality is that most do not have time to track the price of a mutual fund or action and find out if it is increases or decreases. Dollar Cost Averaging helps the investor to put money to work and the instead, keep your mind at peace. The best part of DCA is that the fixed amount of money you want to invest, can be automatically deducted from your bank account. This will help to continually invest in your future because you are increasing your retirement accounts. Remember that if you invest in a deal a large amount of money you may get a higher return, but if you invest a small amount in month after month, your risk will be lower.

So when the Market Bear made to investors, many do not have the confidence to invest again. But it is important to continue to investing in your accounts. For investors hit the "bad bear" DCA is a great solution that will help effectively reinvest.

Basic tips for Dollar Cost Averaging strategy:

1. Calculate how much you can spend each month: Make sure that money is automatically deducted from your bank account. Pay yourself first.

2. Decide where to invest the money: If you are depositing a lot of money to be distributed in different kinds of investments. Study the opportunities you have to hold to the course. Do not get bought and sold. Keep your plan!

3. Do not confuse action with investment behavior: Be patient while you are investing for retirement. Many investors get excited about buying and selling as it is more exciting.

4. Diversify your retirement accounts: Invest in companies that pay dividends as mutual funds, stocks and stock groups is a good way to create an eclectic mix for your retirement accounts. The amount of money when you retire will depend on the money deposited or invested in their accounts.

5. Invest a large amount of money when the market is low. Take advantage when the market is rather low! After several years you will notice the difference. But be sure to keep investing a set amount out of your bank account. If you follow the plan you will not be disappointed.

* Read also for any other investing ideas and strategies on the Carnival of Value Investing

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