Constant-dollar plan

Definition:

Method of purchasing securities by investing a fixed amount of money at set intervals. The investor buys more shares when the price is low and fewer shares when the price is high, thus reducing the average cost.

Investing Essentials


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

Term of the Day

Forward delivery

A transaction in which the settlement will occur on a specified date in the future at a price agreed upon on the trade date.

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