{"id":4608,"date":"2021-02-15T13:52:59","date_gmt":"2021-02-15T05:52:59","guid":{"rendered":"https:\/\/www.investagrams.com\/daily\/?p=4608"},"modified":"2021-02-15T21:38:16","modified_gmt":"2021-02-15T13:38:16","slug":"how-to-trade-without-anxiety-cost-averaging","status":"publish","type":"post","link":"https:\/\/www.investagrams.com\/daily\/2021\/02\/how-to-trade-without-anxiety-cost-averaging\/","title":{"rendered":"How To Trade Without Anxiety (Cost Averaging)"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Definition\u00a0<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">Cost averaging is the method of investing where a certain amount of money is invested in a specific interval over time.\u00a0<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Advantages\u00a0<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">Mitigates Risk\u00a0<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Very Smart way of investing in the long term\u00a0<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Conclusion\u00a0<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">It is asset accumulation\u00a0<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Additional Ideas:<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Investing long term without the anxiety\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Not everyone can time the market as well as the top traders in Investagrams, and not everyone can handle the pressure red candle sticks bring during dumps. Even though there is no absolute risk free method of investing, there are methods smart investors use to minimize risk. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Cost averaging is perhaps the simplest and least stressful approach to investing, wherein the main objective is to accumulate as many shares as possible and stay above the average price to gain profit.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Cost averaging is a very long term and conservative investing strategy. Instead of investing a lump sum and risking everything all at once with a single pump or dump ready to make you rich or penniless, implementing cost averaging regularly takes portions of your lump sum and invests it in a preset schedule. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Being able to accumulate shares over time at different price points protects your portfolio from the painful losses of sharp dumps. Since Cost averaging is very conservative in nature, it doesn\u2019t benefit as much as other methods from breakouts. It, however, does a very excellent job of preserving your wealth.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">To put cost averaging into perspective, suppose that you want to invest 1M in Jollibee Foods Corp., which is currently 4 pesos per share. If you invest everything in a single price, and that price drops to 3 pesos per share in the following week, you would have already lost a quarter of your capital if you were to close the trade.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Now, if you were to invest your 1M evenly in a span of 8 months, you wouldn\u2019t have to commit to a singular price that can dictate your capital the next day or so. Investing 125 000 per month, and purchasing as many shares as your monthly budget can afford mitigates your risk and prevents a single price to lift or crush your capital.<\/span><\/p>\n<p><span style=\"font-weight: 400;\"> Yes, you would sometimes buy an overpriced share, sometimes an underpriced share, but as you accumulate shares over the months, time will do its part and grow your capital. No more FOMO, no more complicated Technical Analysis, no more stress.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It is important to note that like everything in investing, there is still risk involved in this approach, and that cost averaging isn\u2019t the one size fits all answer for getting rich. Declining markets can still be a threat to your capital even if you follow this approach.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><strong>The cost averaging approach is not for everyone though.<\/strong> Investors who are really thinking long term will find this strategy stress free, easy, and effective. It eliminates confusion during entry and exit, and gives clarity to investing in the stock market by keeping things simple. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Traders with higher risk appetites however, may find this method a bit slow and boring for their liking as they are used to riding trends, anticipating pumps and dumps, and getting in and out fast. Even as such, cost averaging shouldn\u2019t be completely overlooked by traders as this can still be a useful approach to preserving the wealth that they have accumulated over time.<\/span><\/p>\n<hr \/>\n<figure id=\"attachment_4610\" aria-describedby=\"caption-attachment-4610\" style=\"width: 1438px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/invs.st\/PrimeMillionairesCupCircuit1SM\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-4610 size-full\" src=\"https:\/\/dailymedia.investagrams.com\/investadaily\/2021\/02\/mcup-landscape.png\" alt=\"\" width=\"1438\" height=\"750\" srcset=\"https:\/\/dailymedia.investagrams.com\/investadaily\/2021\/02\/mcup-landscape.png 1438w, https:\/\/dailymedia.investagrams.com\/investadaily\/2021\/02\/mcup-landscape-300x156.png 300w, https:\/\/dailymedia.investagrams.com\/investadaily\/2021\/02\/mcup-landscape-768x401.png 768w, https:\/\/dailymedia.investagrams.com\/investadaily\/2021\/02\/mcup-landscape-1024x534.png 1024w, https:\/\/dailymedia.investagrams.com\/investadaily\/2021\/02\/mcup-landscape-610x318.png 610w\" sizes=\"auto, (max-width: 1438px) 100vw, 1438px\" \/><\/a><figcaption id=\"caption-attachment-4610\" class=\"wp-caption-text\">Click the photo to join for FREE!<\/figcaption><\/figure>\n<div style=\"margin-top: 0px; margin-bottom: 0px;\" class=\"sharethis-inline-reaction-buttons\" ><\/div><div style=\"margin-top: 30px; margin-bottom: 50px;\" class=\"sharethis-inline-share-buttons\" ><\/div><span class=\"et_bloom_bottom_trigger\"><\/span>","protected":false},"excerpt":{"rendered":"<p>Definition\u00a0 Cost averaging is the method of investing where a certain amount of money is invested in a specific interval over time.\u00a0 Advantages\u00a0 Mitigates Risk\u00a0 Very Smart way of investing in the long term\u00a0 Conclusion\u00a0 It is asset accumulation\u00a0 Additional Ideas: Investing long term without the anxiety\u00a0 Not everyone can time the market as well [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":4609,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"cybocfi_hide_featured_image":"","footnotes":""},"categories":[36,34],"tags":[],"class_list":["post-4608","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-how-to-advice","category-latest-posts"],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts\/4608","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/comments?post=4608"}],"version-history":[{"count":3,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts\/4608\/revisions"}],"predecessor-version":[{"id":4613,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts\/4608\/revisions\/4613"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/media\/4609"}],"wp:attachment":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/media?parent=4608"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/categories?post=4608"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/tags?post=4608"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}