Dollar Cost Averaging Calculator.
DCA vs Lump Sum, Side by Side.
Invest a fixed amount every week or month, enter the prices you expect (or have already paid), and see how many shares you end up with, your average cost per share, and whether putting the whole amount in at the start would have done better.
DCA Calculator Inputs
A fixed amount, bought on a schedule
DCA Results
Updates as you type
Average cost per share
$40.91
vs simple average price $44.17
- Total invested
- $3,000.00
- Shares accumulated
- 73.3333
- Value at last price ($60.00)
- $4,400.00
- Gain / loss
- $1,400.00 (+46.67%)
DCA vs lump sum at the first price
DCA ends $800.00 ahead of the lump sum on this price path.
Assumes fractional shares, no fees or taxes, and that cash waiting to be invested earns nothing.
Purchase by purchase
| Month | Price | Shares bought | Total shares | Total invested | Avg cost |
|---|---|---|---|---|---|
| 1 | $50.00 | 10 | 10 | $500.00 | $50.00 |
| 2 | $40.00 | 12.5 | 22.5 | $1,000.00 | $44.44 |
| 3 | $25.00 | 20 | 42.5 | $1,500.00 | $35.29 |
| 4 | $40.00 | 12.5 | 55 | $2,000.00 | $36.36 |
| 5 | $50.00 | 10 | 65 | $2,500.00 | $38.46 |
| 6 | $60.00 | 8.3333 | 73.3333 | $3,000.00 | $40.91 |
How dollar cost averaging works
With dollar cost averaging you decide on an amount and a schedule, say $500 on the first of every month, and stick to it whatever the market does. The amount stays fixed, so the number of shares changes: a low price buys more shares and a high price buys fewer. Over many purchases that tilts your holding toward the cheaper prices.
Dollar cost averaging formula
Shares bought = Amount ÷ PriceAverage cost per share = Total invested ÷ Total sharesThe average cost is the harmonic mean of the prices you paid, which is always at or below the simple average of those prices.
DCA is different from averaging down. Averaging down is a decision to buy more of a position because it has fallen; DCA buys on a timetable, up or down. Our guide to averaging down vs dollar cost averaging covers the difference, and the stock average calculator works out the new average for one-off extra purchases.
Dollar cost averaging example
You invest $500 a month for six months. The price starts at $50, drops to $25, and recovers to $60. These are the calculator's default inputs, so you can follow along above.
| Month | Price | Invested | Shares bought |
|---|---|---|---|
| 1 | $50 | $500 | 10.00 |
| 2 | $40 | $500 | 12.50 |
| 3 | $25 | $500 | 20.00 |
| 4 | $40 | $500 | 12.50 |
| 5 | $50 | $500 | 10.00 |
| 6 | $60 | $500 | 8.33 |
| Total | avg $44.17 | $3,000 | 73.33 |
- Average cost per share: $3,000 ÷ 73.33 shares = $40.91
- Simple average of the prices: ($50 + $40 + $25 + $40 + $50 + $60) ÷ 6 = $44.17. DCA paid $3.26 a share less than that, because the $25 month bought twice as many shares as the $50 months.
- Value at the last price: 73.33 × $60 = $4,400, a gain of $1,400 (+46.67%).
- Lump sum instead: $3,000 at $50 in month 1 buys 60 shares, worth 60 × $60 = $3,600, a gain of $600 (+20%).
Dollar cost averaging strategy: DCA or lump sum?
If you already have the money, the honest starting point is that a lump sum has historically come out ahead more often. Markets have tended to rise over time, and DCA keeps part of your money in cash while you wait. What DCA buys you is protection from the worst case: putting everything in just before a large fall.
- • You invest from income as it arrives (salary, 401(k), SIP)
- • A sharp drop right after investing would make you sell
- • The amount is large relative to what you already hold
- • You want a rule that removes the temptation to time the market
- • You have a long horizon and can sit through a fall
- • The money is already set aside for investing
- • Per-trade fees would eat into many small purchases
- • You would otherwise leave the cash idle for months
A middle path is to set a short, fixed DCA schedule (for example, the whole amount over a few months) and not change it based on headlines. Project a one-off investment with the lumpsum calculator, and read how to build wealth with dollar cost averaging for a longer look at running a DCA plan.
Frequently Asked Questions
What is dollar cost averaging?▾
Dollar cost averaging (DCA) means investing the same amount of money at regular intervals, such as every week or month, whatever the price. Because the amount is fixed, each purchase buys more shares when the price is low and fewer when it is high.
How do you calculate dollar cost averaging?▾
For each purchase, divide the amount invested by that day's price to get the shares bought. Add up the shares, then divide the total invested by the total shares to get your average cost per share. In the example on this page, $3,000 buys 73.33 shares, so the average cost is $3,000 ÷ 73.33 = $40.91.
Why is my DCA average cost lower than the average price?▾
Your average cost weights each price by the number of shares you bought at it, and a fixed amount buys the most shares at the lowest prices. That pulls the average cost below the simple average of the prices. The two are equal only when every purchase is at the same price.
Is dollar cost averaging better than investing a lump sum?▾
Not usually on returns alone. Markets have tended to rise over long periods, so money invested all at once has historically come out ahead more often than the same money fed in over time. DCA wins when prices fall after you start, and it limits the damage of investing everything just before a drop. Many investors accept the lower expected return for that smoother ride.
Is a 401(k) or SIP contribution dollar cost averaging?▾
In practice, yes: a fixed amount from each paycheck buys investments on a schedule. The DCA versus lump sum question only arises when you already have the whole amount in cash and are choosing whether to invest it at once or spread it out.
Method and sources
Each period, the calculator divides the amount invested by that period's price to get the shares bought, then divides the total invested by the total shares for the average cost per share. The lump-sum comparison invests the same total at the first price; both positions are valued at the last price, with fractional shares and no fees, taxes or interest on cash waiting to be invested.
- Dollar Cost Averaging — Investor.gov, U.S. Securities and Exchange Commission
- The Benefits and Limitations of Dollar-Cost Averaging — FINRA
Written by Utkarsh Mohan. Last reviewed . Results are estimates for education, not financial or tax advice.
Guides on dollar cost averaging
- How to Build Wealth with Dollar Cost Averaging (Without Timing the Market)The systematic default for most investors, and its real limits.
- Averaging Down vs Dollar-Cost Averaging: Which Strategy Wins?Reactive conviction buying versus a systematic schedule — routinely confused.
- How to Build a DCA Portfolio: Step-by-Step GuideTurning the principle into an actual allocation and schedule.
- Lump Sum vs DCA: When to Invest All at OnceWhat the evidence says about deploying a windfall gradually or at once.
- SIP vs Lump Sum: The definitive Guide to Investing Your MoneyThe definitive comparison, with the maths behind each approach.
- Value Averaging: The Smarter DCA Alternative?Targeting a portfolio value rather than a fixed contribution.
- DCA Out: How to Sell Without Timing the MarketSelling systematically, so the exit isn't a single timing bet.
- Cost Averaging Explained: Dollar, Rupee, Pound & Euro Cost AveragingCost averaging across dollars, rupees, pounds and euros.
- Daily vs Weekly vs Monthly SIP: Which Frequency Gives Best Returns?Whether daily, weekly or monthly contributions actually change the outcome.
- Index Funds vs Individual Stocks: Which Should You Choose?The trade-off between market returns and concentrated bets.
Related calculators
Guides that explain this calculator
- How to Build Wealth with Dollar Cost Averaging (Without Timing the Market)The systematic default for most investors, and its real limits.
- Averaging Down vs Dollar-Cost Averaging: Which Strategy Wins?Reactive conviction buying versus a systematic schedule — routinely confused.
- Lump Sum vs DCA: When to Invest All at OnceWhat the evidence says about deploying a windfall gradually or at once.
- Value Averaging: The Smarter DCA Alternative?Targeting a portfolio value rather than a fixed contribution.