Dollar cost averaging is an investment strategy where one periodically buys shares or invests in one or more funds for a fixed number of dollars. Usually people buy every month or every week, say for $ 500. In the months that the price of the participations is high, you buy fewer shares than in the months that the price is low. So the average price is between the high price and the low price.

The idea of dollar cost averaging is that you lower the risk on your portfolio since your average buy price is below the highest price. Especially in volatile markets this is an advantage. Regularly investing in a fund can also be a way of disciplined saving: each month you can for example automatically invest 10% of your salary in a fund.

Against this practice is that your transaction costs usually increase with the number of trades you make. You could consider investing once a year in order to reduce your transaction costs. The averaging is then over the years instead of over the months.

Suppose the money you invest is initially available, that is you don't have to earn it every month.  Suppose furthermore that your investment is not very volatile. In such circumstances it is mathematically better to invest everything in one go, your returns will be higher.

If you invest a part of your salary every month then it could be that your income decreases and you have to reduce the amount of your monthly investments. This typically occurs when the economy is bad, and guess what, when the stock markets are relatively low priced. So it could still be that you decide to reduce your investments just when the markets bottom.