Dollar-cost averaging

Simple explanation

Dollar-cost averaging means investing a fixed amount on a regular schedule (e.g., €200 every month) regardless of what the market is doing.

Picture this

Drip irrigation: small steady drops fill the tank even when there's no rain. You can't predict the weather — but you keep watering.

— Byte

Real example

€100/month into a world ETF: some months you buy more shares (when prices dip), some months fewer (when high). The average cost smooths out — you don't need to time anything.

Common mistake

Pausing your monthly investment because markets feel scary. That's exactly when you'd want to keep going — you're getting more shares for the same money.

Quick check

Takeaway

Automate it. Forget it. Let the math do the work.

Related glossary terms