The purchase of a security when its price has fallen in order to reduce the average cost of owning the investment. – Investment strategy in which initial assets are not invested all at once, for example in the stock market, but spread over several months. This is a kind of hedge against high initial losses because one never enters a bear market fully invested. Experience shows that a partial loss of the initial capital (here: initial investment) hurts far more than the later loss of a part of the profits made. – See cost-average effect, daimonion, gambling effect, tag, loss perception, incongruent, loss trap.
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
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