What is DCA or Dollar-Cost Averaging? A steady investment approach for beginners in 2025

Building long-term wealth doesn’t have to start with a large capital. If you choose the right and consistent investment method, the most popular approach today is DCA or Dollar-Cost Averaging, which involves gradually investing a fixed amount of money to buy shares at regular intervals, regardless of whether prices are high or low. This article will explain this method in detail and help you understand the meaning of DCA clearly.

DCA meaning: Definition and How It Works

DCA stands for Dollar-Cost Averaging. It is an investment strategy where investors divide their total investment into smaller parts by paying the same amount of money at regular intervals, such as monthly, weekly, or quarterly.

Key features of DCA include:

• Investing a fixed amount each time, e.g., (3,000 THB per month)
• Ignoring market price fluctuations
• When prices rise, fewer units are purchased; when prices fall, more units are bought
• Helps to balance the average cost

This method is suitable for people with regular income because it allows continuous savings planning without requiring deep knowledge of stock market analysis.

Example of DCA Effectiveness: Sample Table

To clearly see how effective DCA can be, consider the following example:

From this table, you can see that if you invest 3,000 THB every month over 12 months, your average cost per share is 9.67 THB. Even if the ending price is 15 THB, investing a lump sum of the same total amount (36,000 THB) at the end of the year would give you only 2,400 shares. Using DCA, you acquire 3,940.69 shares, which is 1,540.69 shares more.

Advantages of DCA Investment

1. Start with small capital, no burden

This method allows those with limited funds to enter the stock market without waiting to accumulate a large amount. Investing 1,000-5,000 THB per month is sufficient.

2. Reduce risk from price volatility

By purchasing at multiple times, the average cost remains in the middle, avoiding the risk of buying at the highest price.

3. Build disciplined saving habits

Setting a goal to regularly save money reduces unnecessary spending and fosters a habit of wealth accumulation.

4. No need for expert knowledge

Beginners can use this method because it doesn’t require complex technical or fundamental analysis.

5. Potentially higher returns than bank interest

In the long run, stock returns tend to surpass bank deposit interest, especially stocks with solid fundamentals.

Limitations of DCA to Know

1. Risk of choosing wrong stocks

If you buy stocks without growth prospects, even DCA can result in losses. Therefore, studying stocks before investing is very important.

2. Cost may be higher than current market price

In the short term, the average cost might be above the market price, leading to temporary losses.

3. Not suitable for short-term profit seeking

This method is designed for long-term investing. If you prefer timing the market or short-term speculation, DCA may not be suitable.

Which stocks are suitable for DCA?

Before allocating funds to your portfolio, consider stocks with these characteristics:

• Competitive advantage: Choose companies with strong industry positions
• Growth potential: Businesses with continuous growth and low risk of discontinuation
• Consistent profits: Companies showing strong performance in both good and bad market periods
• Manageable debt levels: Debt that can be handled without risking breach of covenants
• Increasing retained earnings: Demonstrates good management capability

Comparing brokerage firms offering DCA

If you’re interested in this investment style, consider these brokerages:

6 recommended stocks for beginners starting DCA

1. PTT - PTT Public Company Limited(

A national energy company with a comprehensive business scope—from exploration, production, refining, to distribution. With high stability and consistent dividend payments, PTT is a safe choice for long-term investment.

) 2. CPALL - CP All Public Company Limited### Operates over 13,000 7-Eleven convenience stores with continuous profits and expanding into other sectors. A suitable stock for long-term holding.

( 3. SCC - Siam Cement Public Company Limited) A leader in cement, chemicals, and packaging in ASEAN, with a 100-year history and good adaptability to change.

4. INTUCH - Intouch Holdings Public Company Limited(

Invests in telecommunications via AIS, Thailand’s leading provider, with steady cash flow and high dividend payout.

) 5. BBL - Bangkok Bank Public Company Limited### A leading bank with stability, diverse customers, and continuous dividends—ideal for financial sector investors.

( 6. CPN - Central Pattana Public Company Limited) Manages over 30 leading shopping malls in Thailand, with steady rental income, continuous growth, and good adaptability.

Summary

DCA or Dollar-Cost Averaging is an investment method suitable for beginners, those with regular income, and long-term investors who want to avoid price concerns. By selecting fundamentally strong stocks, investing consistently, and allowing time for growth, your returns are likely to increase over time. The key is to start and be patient—it’s not about having huge capital but about consistent action.