“dollar-cost averaging” is a phrase that refers to investing regular amounts over time, rather than investing all your money in a fund at once. Why would you do this? Imagine if you invest $10,000 tomorrow and the stock drops 20 percent. At $8,000, it will need to increase 25 percent (not 20 percent) to get back to $10,000. By investing at regular intervals over time, you hedge against any drops in the price—and if your fund does drop, you’ll pick up shares at a discount price. In other words, by investing over time, you don’t try to time the market. You use time to your advantage. This is the
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