Dollar Cost Averaging Calculator
Calculate your average cost basis when buying at different prices over time.
Compare DCA to lump sum investing.
DCA Analysis
Dollar Cost Averaging (DCA) involves investing a fixed amount at regular intervals regardless of price. Your average cost basis is calculated as:
Average Cost = Total Amount Invested / Total Units Purchased
Per period:
Units Bought = Investment Amount / Price at Time of Purchase
Why DCA works:
- You buy MORE units when prices are LOW
- You buy FEWER units when prices are HIGH
- This naturally averages your cost basis lower than the average price
DCA vs. Lump Sum:
- Historically, lump sum investing beats DCA ~67% of the time (because markets tend to go up)
- DCA reduces the risk of investing everything at a market peak
- DCA is psychologically easier — removes timing decisions
Enter your periodic investment and the prices at which you purchased. The calculator assumes equal investment amounts at each price point.