Investing Basics Beginner

Dollar-Cost Averaging (DCA)

💡 In plain English: Invest the same fixed amount regularly regardless of market levels — buy more units when cheap, fewer when expensive.

Definition

An investment strategy of buying a fixed amount of an asset at regular intervals, reducing the impact of price volatility.

📌 Real-World Example

You invest ₹5,000 every month in a Nifty 50 index fund. When Nifty falls 15%, you automatically buy more units for the same ₹5,000. Over time, your average cost per unit is lower than if you had invested all at once.

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Related Terms

Compound Interest
Your money earns interest, then that interest earns MORE interest...
SIP (Systematic Investment Plan)
A way to invest in mutual funds automatically each month — India's...
Index Fund
A fund that simply copies a market index like Nifty 50 — no fund...
Volatility
How much a stock's price swings up and down — high volatility =...
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⚠️ Educational Content: All definitions and examples on this page are for educational and consultancy reference purposes only. They do not constitute financial, legal, or investment advice. Moneykar is not registered with SEBI, CBUAE, SCA, or any financial regulator. Consult a qualified professional before making financial decisions.

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