| Investing in stocks doesn’t have to be difficult. In fact, all it takes is a simple yet savvy technique that actually helps you take advantage of - and capitalize on - the market’s volatility:
Invest a set dollar amount on a regular schedule.
Fixed dollar investments on a regular basis is a disciplined, time-tested investment strategy called dollar-cost averaging that helps you...
- Steadily build your portfolio over time so more of your hard-earned money can reap the potential benefits of time and compounding.
- Stay on track even through down markets and build positions to take advantage of up markets.
- Lower your investment risk as you buy more shares when prices are low and fewer when prices are high.
- Take the emotion out of investing because you’ll spend less time worrying about when to invest.
The Power of Regular Investing
Here’s a simple yet powerful example of how you can benefit from regular investing over time: If you invested $1,000 at 11%, the approximate historical average return for stocks, it could grow to $8,062 at the end of 20 years.* But if you added just $100 per month to that $1,000 initial investment, your investment could grow to $94,626. If you could afford $500 per month, you’d have nearly half a million dollars. The best part is that your $121,000 total investment provided more than $319,000 in compounded earnings!
Source:CalcBuilder for any 10/20 year period at an assumed 11% rate of return.
* The securities markets are subject to the risks of fluctuating prices and the uncertainty of rates of return and yields inherent in investing. Past performance is no guarantee of future results.
While periodic investing plans don’t assure a profit or protect against a loss in declining markets, and you should consider your ability to continue purchasing shares during periods of low price levels, dollar-cost averaging can help minimize the effects of market volatility because you’re buying more shares when prices are low and fewer when prices are high.
Your average Price per share = $9.38 ($37.50 / 4)
Your average Cost per share = $8.33 ($2,000 / 240)
Your current Profit per share = $1.67 (at last price of $10)
How to Invest Regularly - Automatically
Like eating right and getting enough exercise, knowing all the benefits of investing regularly doesn’t make it any easier – unless you can do it automatically. That’s why BUYandHOLD has made automatic investing convenient, affordable and as easy as one, two, three with our E-ZVestsm service:
- Open an account entirely online using our E-Signature feature.
- Select BUYandHOLD Instant Deposit, a link from your personal bank account to your BUYandHOLD account, so you can buy stocks today.
- Select BUYandHOLD’s E-ZVestsm service so you can invest a specific dollar amount (as little as $20 or as much as you want) in each stock you choose on a weekly, monthly or quarterly basis.
When you use BUYandHOLD for your Regular Investing Plan, you can . . .
- Make investing a habit with BUYandHOLD Instant Deposit and E-ZVestsm.
- Start small and think big – even small amounts can add up over 20 or 30 years.
- Invest a little at a time -- you don’t have to wait until you’ve saved a large amount of money to invest.
At BUYandHOLD, automatic, regular investing is easy to do, yet powerful enough to help you reach the most important long-term financial goals of your life. So don’t delay another day because the sooner you start, the more time you’ll have to benefit from some of the keys to successful investing -- time and compounding. Open an account today.
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