Average down

Definition:

A strategy used by investors to reduce the average cost of shares, in which the investor purchases more shares with a fixed amount of capital as the price of the shares decreases. The investor receives more shares per dollar and decreases the average price per share.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Thrift institution

An organization formed as a depository for primarily consumer savings. Savings and loan associations and savings banks are thrift institutions.

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