What is Dollar-cost averaging (DCA)?
Buying a fixed amount at regular intervals regardless of price, so purchases average out over time.
DCA removes timing decisions, which is its real benefit: it is a behavioural tool more than a mathematical one. It reduces the risk of committing everything at a single unfortunate moment.
It does not guarantee a profit and does not protect against a sustained decline. Our converter includes a DCA view that shows what a schedule would have accumulated historically — a description of the past, not a projection.
Related terms
Volatility
The magnitude of price variation over time. Bitcoin's is high by the standards of every traditional asset…
MarketsRisk management
Deciding in advance how much can be lost, and structuring positions so that no single outcome is ruinous.
MarketsPosition sizing
Deciding how much to commit to a position based on how much you are prepared to lose if it goes against you.
This definition is part of the Bitcoin Logical glossary. For the fuller explanation, start with Learn, or see the live numbers on The Bitcoin Signal.