When we purchase additional units of a security at a lower price than our initial investment, we are practicing a strategy called "averaging down." This approach is used to lower the average cost per unit of our investment. It can be a valuable tool in minimizing risk and maximizing potential returns. By carefully considering market trends and making informed decisions, we can effectively implement this technique in our investment portfolio. It requires patience and a deep understanding of market dynamics, but the potential benefits make it a valuable concept to master.
