Averaging Up!

Averaging Up is the process of buying additional shares of a stock one already owns, but at a higher price. It raises the investor’s average price of acquisition. Investors usually do this exercise when they are confident about the fundamental quality of the company and believe that the company should be valued much more. So, when you have a high-quality stock, don’t be afraid to tank up, even if the price keeps edging higher as long as its fundamentals & growth drivers are intact.