What is dollar-cost averaging?
Dollar-cost averaging (DCA) means investing a fixed amount every month — say 100 — regardless of whether the price is high or low. In Denmark it is simply called månedsopsparing, monthly saving. Because the amount is fixed, you automatically buy more units when it is cheap and fewer when it is dear. You do not have to guess the right moment, and you can never end up putting everything in at the top.
Each dot is a purchase. When the price is low, you get more units for the same money.
A worked example
You put 100 into a fund three months in a row. The price is 10, 8 and 12.50.
- Month 1: 100 / 10 = 10 units
- Month 2: 100 / 8 = 12.5 units
- Month 3: 100 / 12.50 = 8 units
30.5 units in total for 300 — an average price of 9.84. The average of the three prices was 10.17. So you bought more cheaply than the average, without doing anything but sticking to it. That is the whole trick: the fixed amount buys most when the price is lowest.
What it does not do
Dollar-cost averaging does not give a higher return than investing everything at once — in fact a single lump sum has historically returned slightly more in most periods, because the market rises more often than it falls. What it gives is calm: you do not need to know whether now is a good time. And for most people it is not a choice anyway — the money arrives once a month with the salary.
How to set it up
Most banks and brokers offer an automatic monthly saving plan: you choose funds or stocks and an amount, and they buy automatically every month — often with low or no commission. That also solves the problem that small trades are otherwise expensive. Check which funds can be chosen, and whether it can run inside a tax-favoured account such as the Danish aktiesparekonto.
The typical beginner's mistake
Pausing the saving plan when the market falls — "I'll wait until it turns." Those are exactly the months when the fixed 100 buys the most units. The pause removes the only advantage the method has.
How you see it in Kiggo
Kiggo does not trade and sets up no saving plan — your bank does. If you enter your monthly purchases in Kiggo's portfolio, it shows your gain and loss on the fund. Under "Get started" you can see which providers offer monthly saving.
Related terms
Frequently asked questions
How much should I put in each month?
The amount you can do without for many years without noticing. 50 every month for 20 years beats 500 for three months and then nothing. The most important thing is that it continues.
Is it better to invest everything at once?
Historically slightly better on average, because the market usually rises. But it requires a large sum and the stomach to watch it fall right afterwards. Dollar-cost averaging is the calm route — and for most people the only possible one.
Can I run it inside a tax-favoured account?
Often yes, with providers that offer both. Then you get both the fixed rhythm and the lower tax. Check that the fund you choose is allowed in the account.
Kiggo explains — Kiggo does not advise. We never tell you what to buy or sell, and key figures can only be compared between companies in the same industry. The decision is yours. Last updated 2026-09-23.
Written by Claus Frisch, founder of Kiggo. Not an adviser, not a bank — Kiggo explains, you decide.
