Concerned about Market Volatility

Dollar Cost Averaging

August 9, 2016

Q: I have $10,000 to invest but I’m concerned about market volatility. Should I invest it in a lump sum or spread it out over time?

A: You might want to consider Dollar Cost Averaging (DCA), an investment strategy that reduces the impact of market volatility on large purchases of financial assets like stocks or mutual funds. It requires investing a fixed dollar amount at regular intervals, regardless of share price. More shares are purchases when prices are low, fewer are bought when prices are high.

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