Dollar-cost averaging
Investing a fixed amount on a regular schedule, no matter the price, so you buy more shares when prices are low.
Contributing from every paycheck to a 401(k) is dollar-cost averaging. You do not have to guess the right time to buy.
Because the amount stays the same, your money buys more shares when prices drop and fewer when they rise. It does not prevent losses, but it builds a steady habit and takes emotion out of timing. Automatic transfers make it easy to keep going.
Example
$100 at $20 a share buys 5 shares. The next month, $100 at $25 a share buys 4 shares. You own 9 shares for $200, an average of $200 ÷ 9 = about $22.22 a share.