Dollar-Cost Averaging

Biological Parallel

Semelparous salmon stake everything on one spawning event—catastrophic if conditions are poor that year. Iteroparous species like bears reproduce annually across decades, averaging reproductive success across variable conditions. A bad berry year doesn't end the lineage; next year might be abundant. This life history strategy is temporal bet-hedging: spreading reproductive investment across time reduces variance in lifetime fitness. Dollar-cost averaging applies identical risk reduction: steady investment across market cycles averages entry points, smoothing volatility through temporal distribution.