What Is Dollar-Cost Averaging and When Is It a Good Investment Strategy?

Dollar-cost averaging (DCA) is an investment strategy of allocating an amount of money at a regular interval (e.g. monthly or quarterly), instead of investing the full sum of money at one time. The strategy can also be used over a short period of less than a year, or even for a longer term goal like retirement. DCA is generally used for more volatile investment asset classes like stocks and equity funds.