DCA in gold: a practical alternative to market timing

Gold prices are currently at a high level. During such periods, many investors show renewed interest in gold but often wonder whether now is the right time to buy. Finding the perfect entry point, known as market timing, often proves difficult in practice.

One strategy that helps reduce this timing risk is dollar cost averaging (DCA), the practice of investing a fixed amount in gold at regular intervals. This article explains how DCA works, how you can apply it when buying physical gold, and why this approach can be particularly useful when prices are elevated.

What is DCA and how does it work with physical gold

Dollar cost averaging means investing a fixed amount of money at regular intervals, regardless of the current gold rate. When the price drops, your fixed amount buys more gold. When it rises, you purchase slightly less. Over time, this results in an average purchase price that smooths out short-term fluctuations.

The goal of DCA is to spread risk over time. Instead of investing all your capital at once, you gradually build your position. With physical gold, this process is not automated. The Silver Mountain does not offer a savings plan or recurring investment programme.

However, many of our clients choose to apply this principle themselves. They buy gold regularly, for example a bar or coin each month or quarter, to build their holdings steadily and reduce the impact of short-term price movements.

Why buying gold gradually can be a smart strategy

In September 2025, the gold price averaged around €100 per gram.. In the months before, prices fluctuated between roughly €89 and €95 per gram. Such gradual upward movement makes timing a single entry point difficult.

Because nobody can predict where the price will move next, spreading your purchases over time helps reduce the risk of buying at an unfavourable moment. It also brings peace of mind, as you do not need to follow the market constantly or make emotional decisions based on short-term changes.

Example: applying DCA to gold in 2025

The following table shows what happens if you invest €250 per month in gold between March and September 2025. 

Across this seven-month period, the average purchase price works out to approximately €93.50 per gram. This example illustrates how DCA works in practice. Sometimes you buy higher, sometimes lower, but overall you achieve a balanced average. It helps you avoid buying all your gold at a peak.

For long-term investors who value stability and consistency, this approach offers a disciplined and steady way to build physical gold holdings without needing to react to every price fluctuation.

The benefits of buying gold periodically

Buying gold at regular intervals removes the emotional element from investment decisions. You gradually build your position without relying on short-term price movements.

This strategy suits investors who view gold as a store of long-term value rather than a speculative asset. Spreading your purchases makes your results less dependent on timing and helps you stay invested confidently, even when prices fluctuate. Regular buying also encourages discipline and structure in your investment approach.

Key considerations when using DCA

DCA is a calm and systematic way to accumulate gold, but it is not a guarantee of profit. The gold price ultimately determines the result. Investors who make smaller, more frequent purchases may pay slightly higher transaction costs compared to one larger order.

This method also requires discipline. You manage your own purchases and decide when to buy based on your budget and the current market. DCA is therefore a personal strategy rather than an automated investment plan.

DCA or waiting: which strategy fits you best

The perfect entry point rarely exists. Even experienced investors struggle to time the market consistently. DCA does not promise higher returns, but it does offer structure and peace of mind. If you prefer a one-time purchase, you can do so whenever the price feels right. The important thing is that the decision aligns with your personal goals, time horizon and risk tolerance.

At The Silver Mountain, we share our knowledge of gold and silver to help investors make informed decisions. Our information is designed to educate, not to advise.

Disclaimer: The Silver Mountain does not provide investment advice. This article is for educational purposes only. Past performance is not indicative of future results.