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Use dollarcost averaging when investing from "summary" of The Intelligent Investor Rev Ed. by Benjamin Graham
Dollar-cost averaging is a simple and effective strategy for investors looking to minimize the risks associated with market fluctuations. Instead of trying to time the market and make large investments all at once, dollar-cost averaging involves investing a fixed amount of money at regular intervals, regardless of the market conditions. By spreading out investments over time, investors can avoid the pitfalls of trying to predict short-term market movements. This strategy helps to smooth out the impact of market volatility, as investments are made at different price points over time. This approach can help investors avoid the temptation to chase hot stocks or panic sell during market downturns. One of the key advantages of dollar-cost averaging is that it takes the emotion out of investing. Instead of making decisions based on fear or greed, investors can stick to a disciplined investment plan and stay the course over the long term. This can lead to better outcomes and help investors achieve their financial goals. While dollar-cost averaging may not guarantee profits or protect against losses, it can be a valuable tool for investors looking to build wealth over time. By consistently investing in the market, investors can take advantage of the power of compounding and benefit from the long-term growth potential of stocks.- Dollar-cost averaging is a straightforward and reliable strategy that can help investors navigate the ups and downs of the market. By staying disciplined and focused on the long term, investors can increase their chances of success and achieve their financial objectives.
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