DCA Calculator
Dollar Cost Averaging - Simulate regular investment strategy
Investment Settings
Price Simulation
DCA vs Lump Sum Comparison
Investment Schedule
| # | Date | Price | Coins | Total Invested | Value | P/L % |
|---|---|---|---|---|---|---|
| 1 | Feb 2026 | $50,769 | 0.001970 | $100 | $91 | -9.1% |
| 2 | Mar 2026 | $46,166 | 0.004136 | $200 | $204 | +2.1% |
| 3 | Apr 2026 | $49,355 | 0.006162 | $300 | $340 | +13.5% |
| 4 | May 2026 | $55,243 | 0.007972 | $400 | $437 | +9.2% |
| 5 | Jun 2026 | $54,800 | 0.009797 | $500 | $601 | +20.3% |
| 6 | Jul 2026 | $61,388 | 0.011426 | $600 | $577 | -3.9% |
| 7 | Aug 2026 | $50,483 | 0.013407 | $700 | $977 | +39.6% |
| 8 | Sep 2026 | $72,908 | 0.014778 | $800 | $979 | +22.3% |
| 9 | Oct 2026 | $66,231 | 0.016288 | $900 | $1,234 | +37.2% |
| 10 | Nov 2026 | $75,787 | 0.017608 | $1,000 | $1,489 | +48.9% |
| 11 | Dec 2026 | $84,543 | 0.018791 | $1,100 | $1,560 | +41.8% |
| 12 | Jan 2027 | $82,997 | 0.019995 | $1,200 | $1,500 | +25.0% |
Frequently Asked Questions
What is Dollar Cost Averaging (DCA)?
Dollar Cost Averaging is an investment strategy where you invest a fixed amount of money at regular intervals (daily, weekly, or monthly) regardless of the asset price. This approach reduces the impact of volatility by spreading purchases over time, resulting in an average purchase price rather than trying to time the market.
Is DCA better than lump sum investing?
Neither strategy is universally better. DCA reduces timing risk and emotional decision-making, making it ideal for volatile markets or risk-averse investors. Lump sum investing historically performs better in rising markets since your money is invested longer. DCA is preferred when you receive regular income or want to minimize regret from poor timing.
How often should I invest with DCA?
The optimal frequency depends on your income schedule and investment goals. Monthly DCA aligns well with salary payments and is most common. Weekly DCA provides more price averaging but requires more transactions. Daily DCA offers maximum averaging but may incur higher fees. Choose a frequency that fits your budget and minimizes transaction costs.
What is the average purchase price in DCA?
The average purchase price is your total investment divided by the total units purchased. With DCA, this average tends to be lower than the simple average of all purchase prices because you buy more units when prices are low and fewer when prices are high.
Can I use DCA for cryptocurrency investing?
Yes, DCA is particularly popular for cryptocurrency investing due to high volatility. Many exchanges offer automatic recurring purchases for Bitcoin, Ethereum, and other cryptocurrencies. DCA helps reduce the anxiety of crypto price swings and builds positions gradually.
Benefits of Dollar Cost Averaging
Reduces Timing Risk
You don't need to worry about buying at the "right" time. DCA removes the pressure of market timing decisions.
Emotional Discipline
Automated, regular investing removes emotional decisions that often lead to buying high and selling low.
Lower Average Cost
You automatically buy more units when prices are low and fewer when prices are high, lowering your average cost.
Accessible to Everyone
Start with small amounts and build wealth over time. DCA makes investing accessible regardless of budget.
What Is Dollar Cost Averaging?
Dollar Cost Averaging (DCA) is an investment strategy in which an investor divides the total amount to be invested across periodic purchases of a target asset, regardless of the asset's current price. By investing a fixed dollar amount on a regular schedule, such as weekly or monthly, you automatically buy more shares or units when prices are low and fewer when prices are high. Over time, this produces a weighted average purchase price that is often lower than the simple average of all the prices at which you bought. The strategy is widely used for stocks, index funds, ETFs, and cryptocurrencies.
The core appeal of DCA is its simplicity and discipline. It removes the emotional burden of trying to time the market perfectly, a task that even professional fund managers rarely achieve consistently. Instead of agonizing over whether today is the right day to invest, you commit to a schedule and stick with it. This systematic approach is especially powerful for beginner investors and those who prefer a hands-off strategy that builds wealth gradually over months and years.
DCA vs. Lump Sum Investing
Academic research has shown that lump sum investing, where you invest the entire amount at once, tends to outperform DCA approximately two-thirds of the time in historically rising markets. This makes sense because, on average, markets trend upward, so having your money invested sooner means it benefits from growth for a longer period. However, lump sum investing also exposes you to the risk of investing at a market peak, which can lead to significant short-term losses and emotional distress.
DCA outperforms lump sum investing in declining or highly volatile markets because it spreads purchases across lower price points. More importantly, DCA reduces the psychological pain of regret. If you invest a large sum and the market drops 20% the next month, you may panic and sell at a loss. With DCA, the same drop means your next scheduled purchase buys more at a discount, which can actually improve your long-term returns. For most individual investors, the behavioral benefits of DCA, including consistency, reduced anxiety, and lower risk of catastrophic timing, often outweigh the slight statistical edge of lump sum investing.
When DCA Works Best
DCA is most effective in volatile markets where prices swing significantly over short periods. Cryptocurrencies, growth stocks, and emerging market assets are prime candidates for a DCA approach because their high volatility means the averaging effect is more pronounced. DCA also works well when you have a regular income stream and want to invest a portion of each paycheck automatically, aligning your investment schedule with your cash flow rather than trying to accumulate a lump sum first.
The strategy is less beneficial in steadily rising markets with low volatility, where delaying investment means missing out on gains. It is also important to consider transaction costs; if your broker charges a fee per trade, frequent small purchases can erode returns. Many modern brokerages and crypto exchanges offer commission-free trading, making DCA more cost-effective than ever before.
Important Disclaimer
This calculator is provided for educational and informational purposes only and does not constitute financial or investment advice. All investment strategies, including Dollar Cost Averaging, carry risk, and past performance does not guarantee future results. Always consult a qualified financial advisor before making investment decisions.