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What is Dollar Cost Averaging (DCA)?
डॉलर कॉस्ट एवरेजिंगDCA is an investment strategy where you invest a fixed amount at regular intervals regardless of price. It reduces the impact of volatility and removes the need to time the market.
Full Explanation
Dollar Cost Averaging (DCA) — or Rupee Cost Averaging in India — is a strategy where you invest a fixed amount (e.g., ₹5,000) into an asset at regular intervals (weekly, monthly) regardless of the current price. When prices are low, you buy more units; when high, you buy fewer. Over time, this averages out your cost basis, reducing the risk of buying at a peak. DCA is especially effective in volatile markets like crypto, where timing the market is nearly impossible for beginners.
Example
Investing ₹5,000 monthly in Bitcoin for 3 years (a "Bitcoin SIP") would give you a lower average cost than trying to time the market. Use Fedha Academy's SIP Calculator to see projected returns.
Related Terms
Last updated: 2026-03-21
