Investing a fixed dollar amount at regular intervals means buying more shares when the price is low and fewer when it’s high — automatically. This works out the actual average cost per share that results, which is not the simple average of the prices paid.
How it works
Weighted average cost
shares bought each period = investment ÷ price that period
average cost per share = total invested ÷ total shares bought
Why the weighted average is usually lower than the simple average
A fixed dollar amount buys more shares when the price is low and fewer when the price is high — this is the entire mechanism dollar-cost averaging is named for. Because more shares get bought at lower prices, the resulting average cost per share is typically pulled below the simple, unweighted average of the prices paid. This calculator shows both numbers side by side specifically to make that gap visible.
DCA doesn’t guarantee a profit
It changes the shape of the exposure, not the direction of the underlying asset. If the price trends downward the entire period, DCA still loses money — possibly less than investing everything at the start, but a loss regardless. If the price trends upward the entire period, DCA typically underperforms investing the full amount immediately, since later purchases buy at already-higher prices.
How to use this calculator
- Enter the fixed amount invested each period.
- List the price at each investment period, separated by commas.
Frequently asked questions
Is dollar-cost averaging always better than investing a lump sum?
Not necessarily — this calculator’s own article explains it doesn’t guarantee a better outcome, only a different exposure pattern. Whether it beats a lump sum depends entirely on the actual path prices take, which isn’t known in advance.
Why is my weighted average cost lower than the simple average price?
Because you automatically bought more shares in the periods where the price was lower — those cheaper purchases carry more weight in the average since more shares were bought at that price.
What if the price is exactly flat across every period?
Then the weighted and simple averages come out identical — with no price variation, there’s nothing for dollar-cost averaging’s mechanism to exploit.
Does this work for any regularly purchased asset?
Yes — stocks, funds, cryptocurrency, anything bought in fixed dollar amounts at regular intervals with a varying price follows the identical arithmetic.
How is “current value” calculated here?
As your total shares multiplied by the most recent price you entered — a snapshot at that final price, not a prediction of where the price goes from there.
