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WellsTrade Dollar Cost Investing Video

Transcript: WellsTrade Dollar Cost Investing

You take a systematic approach to your grocery shopping and your sock drawer. So why not your investing strategy? The ups and downs of the market can make it difficult to know when to invest, which is why employing a more routine, methodical approach may be a suitable strategy. That is the simple premise behind dollar cost averaging: invest a fixed amount in the same investment product at regular intervals over a period of time. It works like this: On the first of every month, you buy $100 worth of shares in Investment A. Some months, the shares might be trading for $25, so you only buy four shares. Other months, the shares might be trading for $20, so you get five. Over time, this strategy increases the shares or other investments you purchase, buying more shares when prices are low and buying fewer shares when prices rise. This is not a magic investing formula. It does not guarantee a profit or even protect from a loss. It is simply a method designed to eliminate the guesswork of picking the perfect time to invest, and help accumulate assets over the long term. So, feel free to add a little unpredictability to your life, as long as it stays away from your investing strategy.
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