An investment strategy designed to reduce volatility in which securities, typically...

An investment strategy where you maintain a constant dollar value in a security or mutual fund. For example, if a constant dollar amount of $100,000. was selected, when ever the value of the investment when over that amount a portion of the investment would be sold to bring the value back to $100,000. When the value went below the $100,000 level, an additional investment would be made to bring the total back up to $100,000. The ideal scenario is to be buying in falling markets and selling in rising markets.

An investment strategy whereby an investor invests a fixed dollar amount on a weekly, monthly, or any other set schedule for a period of time regardless of the current market situation. This type of invest strategy eliminates market timing and assures the investor of buying more securities when the price is low and fewer shares when the price is high. This is also know as Dollar Cost Averaging