Dollar Cost Averaging is defined as purchasing a fixed amount of an investment at regular intervals.

Dollar Cost Averaging is defined as purchasing a fixed amount of an investment at regular intervals.

• A. Asset Allocation
• B. Diversification
• C. Certification
• D. Dollar Cost Averaging

Answer: (D)

Dollar cost averaging is a strategy where you invest a fixed dollar amount at regular intervals, regardless of price. This approach aims to smooth out the impact of market swings by buying more shares when prices are low and fewer when prices are high, which aligns exactly with the definition given. Asset allocation is about how you distribute investments among different asset classes, not the timing or amount of purchases. Diversification deals with spreading risk across many securities, not the regularity or size of investments. Certification is simply a credential and not an investing strategy. So the statement matches dollar cost averaging.

Dollar cost averaging is a strategy where you invest a fixed dollar amount at regular intervals, regardless of price. This approach aims to smooth out the impact of market swings by buying more shares when prices are low and fewer when prices are high, which aligns exactly with the definition given. Asset allocation is about how you distribute investments among different asset classes, not the timing or amount of purchases. Diversification deals with spreading risk across many securities, not the regularity or size of investments. Certification is simply a credential and not an investing strategy. So the statement matches dollar cost averaging.