Value Averaging Strategy
What Is Value Averaging?
Value Averaging is a disciplined investing strategy where investments are adjusted based on market movement. Instead of investing a fixed amount every month, investors increase investments during market falls and reduce investments during rising markets.Why Investors Like This Strategy
- Helps control emotions
- Encourages buying more during corrections
- Builds long-term discipline
- Can improve average purchase cost
Difference Between SIP & Value Averaging
| SIP | Value Averaging |
|---|---|
| Fixed monthly amount | Variable investment amount |
| Easy to automate | Requires periodic review |
| Good for beginners | Good for disciplined investors |