Question on Cost Averaging Method For Stock Market

February 1, 2013 | By Fitz | Filed in: Investing.

If i invested monthly of 3000 for my selected stock with a price of P25, it can only buy 100 shares right? what if my stock appreciate to P30, can i still buy it on the next scheduled order?

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4 Responses to “Question on Cost Averaging Method For Stock Market”

  1. Carlos says:

    Uhm… you can buy, but you may have to buy oddlot shares (less than the boardlot).

    When it appreciates to 30 pesos, your 3K won’t be able to cover the fees and taxes anymore. So either you don’t buy, buy up to 99 shares, or put in more than 3K.

    Oddlot don’t have the same asking or bid prices though. So they might be slightly more or less what the overall market is paying for the stock. I think this is mostly because there are less buyers and sellers for oddlots.

    Happy investing!

  2. erds518 says:

    to xtrade

    Errr. to reduce the hastle of Cost averaging just stick to one share amount for example
    monthly you just buy 100 shares. next month another 100 regardless how much it cost because after a given period of time you will see the cost average growth of the share šŸ™‚
    let say for 5 years you will see it will double the value atleast

  3. Carolyn says:

    Cost Averaging Method has confused me in two different ways:

    1. Should I invest a fixed amount every month (e.g. Php 5,000) per share? And to do this I have to buy through main lot and odd lot?

    2. Should I buy shares per stock based on the boardlot (using only the main lot)?

    I appreciate everyone’s opinion. For now I’m saving and once this cost averaging method riddle is unraveled then I’ll start buying more stocks.

  4. calamba nino says:

    email me at [email protected]. i will give a formula better than PCA.

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