You also
effectively dollar cost average as you are (typically) making these purchases on a quarterly basis.
Not exact matches
DRIPs have become popular means of investment for a wide variety of investors as they enable them to
effectively take advantage of
dollar cost averaging with income in the form of corporate dividends that the company is paying out.
Another strategy: By making a single lump sum into a dividend paying stock (especially the ones that have historically increased dividends annually), one would
effectively get the benefit of an initial lump sum strategy AND would get the dividends reinvested for free using a
dollar -
cost averaging model.
«The beauty of rebalancing and
dollar -
cost averaging is that it helps an investor buy low — when investments are
effectively on sale — countering our natural tendency to do just the opposite,» says Dowd.