Invest steadily over time and take out the guesswork
When you regularly invest a set amount, that’s called dollar cost averaging. You’re not trying to time the market—you simply purchase units at the current price each time. Over time, this means you’ll buy more units when prices are lower and fewer when prices are higher.
Dollar cost averaging vs a lump sum
See in this example how dollar cost averaging can help smooth out market ups and downs. Matteo invests a lump sum while Priya uses dollar cost averaging.
 Month |  Matteo invests |  Priya invests | Matteo’s average cost per share | Priya’s average cost per share | Number of shares Matteo buys | Number of shares Priya buys |
|---|---|---|---|---|---|---|
| January | $2,000 | $500 | $50.00 | $50.00 | 40 | 10 |
| February | - | $500 | - | $31.00 | - | 16.1 |
| March | - | $500 | - | $50.00 | - | 9.6 |
| April | - | $500 | - | $46.00 | - | 10.9 |
| Total | $2,000 | $2,000 | $50.00 | $44.80 | 40 | 46.6 |
For illustrative purposes only; actual performance and results will vary.