Loonie Explain The Ringgit Cost Averaging Strategy.

HOW DOES IT WORKS.

 Ringgit cost averaging is a strategy you invest regularly by adding a similar amount of money over a medium to long term period. Therefore, you can remove the need to forecast the market and can reduce your cost per share below the actual average cost of share over the period you invest.

 In a simple manner, when the price is Low you acquired More units and when the price is High you acquired Fewer units. Let’s take a look at an example below using ringgit cost averaging. It’s a breakdown of monthly payments for 2 years:-

You can apply this on Stock or Unit Trust Investment.

Your cost per unit, is lower compared to Dec Year 2

 TAKE NOTE:-
 There’s no guarantee you’ll make money with ringgit cost averaging. If the fund price declines and doesn’t bounce back eventually, you could lose some of your investment. But in general, ringgit cost averaging can reduce the risk that you’ll invest all of your assets at the market peak.