Suppose I want to invest $1000 every month in asset X, in order to implement a dollar cost averaging strategy. The idea here is that when X is cheap, I will end up buying more shares with my $1000, but when X is high, I will end up buying less.

But suppose also that one share of X costs a large sum, say $750. Because, of this, the amount I buy every month is actually constant: 1, unless X experiences a huge drop in value to $500 or less. Is it still possible to implement dollar cost averaging in this case?


2 Answers 2


I don't think there's any "magic" here, but here are some suggestions.

First, I assume you can't buy fractional shares. Given that, I see 4 possibilities offhand:

  1. Is there some other asset that's basically the same as X but the per share cost is less? Something like BRK.B vs BRK.A, or different funds that track the same, or essentially the same, underlying index or group of assets?
  2. Is there something special about X? Could you instead buy some unrelated asset Y each month?

If you're dead set on buying X:

  1. Buy every two or three months. While DCA is often specified as buying monthly, there's no rule that says you have to do that. People reinvesting dividends are buying every three months (typically).
  2. Buy as much as you can this month, saving what's left over (possibly the whole $1k) for next month. That may turn into effectively buying every two months with an occasional one month interval.

Also, a couple of things to keep in mind:

  • How much commission are you paying and how good are your executions? If you're paying, say, $10 per trade and you're losing 1% because of slippage and/or buying at the ask and selling at the bid, that's 2%/month, which is a big headwind to overcome. That's probably high, but possible for low volumes.
  • If you DCA 2 or 3 months, or even when you have enough money saved up, don't fall into the trap of trying to guess when the asset is down and when it's up. If your plan says buy every 3 months, buy every 3 months, regardless what X is doing (unless it's doing something that makes you think it's no longer a good investment of course).

Given the possibly high cost you might consider waiting until you can invest more per month, and for now just invest in a low cost mutual fund. For example, Vanguard index funds typically have very low expense ratios and those you can buy fractional shares of.

So yes, you can still DCA, but not on a strict $x/month cadence, but that's ok.


The puzzle can be solved:

You want to spend $100/month, but a single share cost $200. How many shares a month can you buy? The answer is 0.5 share. Yes, it's a fraction, but you can achieve it simply by buying a share once every two months.

In fact, you can achieve ANY ratio by modifying the time interval instead of modifying how many shares you buy. In the language of math, you change denominator instead of the numerator.

It sounds complicated but it's not. Let's use silver coins as an example coming from my medium post on a very related topic:

Let’s say you want to buy silver for $1 a day. The 1oz silver coin costs $22. You buy a single coin and schedule the next purchase in 22 days. The price of the second coin is $19, you buy it and set the next time in 19 days, etc. You buy more often when the price is lower and less often when the price is higher. On average, you spend $1/day.

Obviously, it works only as a long-term plan when you expect to buy more than one share.

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