Dollar-Cost Averaging (DCA)
Investing a fixed amount on a regular schedule, regardless of price, to smooth out volatile entries over time.
Dollar-cost averaging, or DCA, means buying a set dollar amount at fixed intervals, say $100 of Bitcoin every Monday, no matter the price. When the price is low your $100 buys more; when it's high, less. Over time your average entry smooths out, and you stop trying to time the market.
The appeal is discipline. DCA removes the emotion that wrecks most retail traders, the urge to buy tops in greed and sell bottoms in fear. It won't beat a perfectly timed lump sum, and nobody times perfectly. In an asset as volatile as crypto, a boring automatic buy is what many long-term holders actually use.
Related terms
A long-term strategy of keeping coins through crashes and rallies instead of trying to time the market.
VolatilityA measure of how sharply and how often a price swings, in either direction, over time.
Bull MarketA sustained period of rising prices, when buyers dominate and optimism pushes valuations higher across the market.
Bear MarketA prolonged stretch of falling prices and weak sentiment, usually marked by a drop of 20% or more.