Dollar-cost averaging can help take the guesswork out of when to invest. Using dollar-cost averaging can help smooth market ups and downs by investing a fixed-dollar amount at regular intervals. Having a disciplined strategy in place can also help you avoid emotional reactions to temporary market movements. To understand more about dollar-cost averaging and its potential benefits, check out this example from Columbia on Dollar-Cost Averaging (Click link to see example). If you have questions about your current portfolio, or want more information on making sound investment decisions, please contact me at (310) 792-2424 to schedule a time to meet.
Dollar cost averaging will not guarantee a profit or protect you from loss, but may reduce your average cost per share in a fluctuating market. Because dollar cost averaging involves continuous investment in securities regardless of fluctuating prices, the investor should consider his or her financial ability to continue purchases through periods of falling prices, when the value of their investments may be declining.
Past performance does not guarantee future results, and no forecast should be considered a guarantee either. Since economic and market conditions change frequently, there can be no assurance that the trends described here will continue or that any forecasts are accurate.