The technique of buying a fixed price amount of a particular investment on a regular schedule, regardless of the share price. More shares are purchased when prices are low, and fewer shares are bought when prices are high. Eventually, the average cost per share of the security will become smaller and smaller. Dollar-cost averaging lessens the risk of investing a large amount in a single investment at the wrong time.

For example, you decide to purchase Kshs 100 worth of XYZ each month for three months. In January, XYZ is worth Kshs 33, so you buy three shares. In February, XYZ is worth Kshs 25, so you buy four additional shares. Finally, in March, XYZ is worth Kshs 20, so you buy five shares. In total, you purchased 12 shares for an average price of approximately Kshs 25 each.