Question 1

What is dollar-cost averaging (DCA)?

Accepted Answer

Dollar-cost averaging means investing a fixed amount on a regular schedule (e.g. $50 every week) regardless of price. It smooths out volatility — you buy more when prices are low and less when they're high — and removes the need to time the market.

Question 2

How do I calculate DCA returns?

Accepted Answer

Total invested = contribution × number of contributions. Projected value treats each contribution as growing at your expected rate of return until the end date (a future-value annuity). Profit = projected value − total invested.

Question 3

Is DCA better than a lump sum?

Accepted Answer

Lump-sum investing usually wins on average because the money is in the market longer, but DCA reduces risk and regret in volatile assets like crypto, and it fits people who invest from each paycheck.

Question 4

How often should I DCA into crypto?

Accepted Answer

Weekly or monthly are most common. More frequent buys smooth volatility slightly more but can cost more in fees — use a low-fee exchange (around 0.1% per trade) and automate it.

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