15628LA-MONY Equity Master Dollar Cost Averaging 2025

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As with any investing strategy, however, dollar-cost averaging comes with risks. It doesnt assure a profit or guarantee protection against losses in a declining market. Also, you might miss out on gains you could have had if youd invested a larger amount right away in a stock or fund that ends up having a big rally.
Dollar-cost averaging1 can help mitigate market timing risk. Choose recurring investments in stocks, mutual funds, ETFs, and Fidelity Basket Portfolios directly from your Fidelity account or your bank. Set the amounts, frequency, and timing of your recurring investments, and change them whenever you need to.
Risks of Dollar-Cost Averaging Your Chosen Investments Need To Grow. Putting a fixed amount in the market at regular intervals works well if the investments you select perform well over time. Youll Need To Watch Your Fees and Taxes. Money That Sits in Savings While Your Dollar-Cost Average Stagnates.
Part of the problem with dollar-cost averaging is that it isnt obvious how you should spread out your investment. Whats worse, it actually matters. It isnt enough to guess right that the price is going to go down, you have to time it so that youre done investing before it goes up too much.
Lump-sum investing outperforms dollar-cost averaging 75 percent of the time, ing to historical data, and is often well suited to investors who have a large sum to invest at once. Dollar-cost averaging may be a better option if you would like to reduce volatility in your portfolio.
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Its cost-effective. As the chart above illustrates, dollar-cost averaging not only creates portfolio momentum by potentially giving you more total shares of a stock or a fund; it can also potentially lower your average cost over time.
The dollar cost average share price is the total investment ($2,250) divided by the total number of shares (22.04). $2,250 / 22.04 = $102.09. An investor can compare this average price to the current price of the fund and have an idea of whether the overall strategy might be profitable or not.
To follow Buffetts advice, youd be wise to employ a strategy known as dollar-cost averaging: investing a set amount of money into your diversified portfolio at regular intervals. In doing so, you guarantee that you buy fewer shares when stocks are expensive and more when the market goes on sale.