Micro-Investing and Stock Market Dips.

Micro-investing, the practice of investing small, regular amounts, offers a strategy to potentially mitigate the impact of stock market dips. This approach, often referred to as dollar-cost averaging, involves investing a fixed dollar amount at regular intervals, regardless of the share price.

Several sources highlight this benefit:

• Acorns: Their article on micro-investing states that "Investing a fixed dollar amount on a regular basis, regardless of share price—also known as dollar-cost averaging (though the term is not limited to the tiny amounts of micro investing)—can help lower the average amount you spend per share. That’s because you’re investing the same amount of money regardless of what share prices are at the moment, which means you scoop up more shares when prices dip and fewer shares when they spike."

• Bankrate: Their article on micro-investing explains that dollar-cost averaging "takes the market-timing decision out of the equation. The consistent purchases mean that you’ll be buying more shares when prices are low and fewer shares when prices are high. With dollar-cost averaging, you’ll be buying over time and averaging your purchase prices."

• The Penny Hoarder: This source also emphasizes dollar-cost averaging, stating that "By making regular, fixed-amount investments, you average out the roller coaster highs and lows of the stock market. You end up buying more when the price is low and less when the price is high."

In essence, micro-investing's consistent investment schedule helps you buy more shares during market downturns, potentially lowering your average cost per share over the long term. While it won't eliminate losses, it can lessen their overall impact. However, it's crucial to remember that micro-investing alone may not be sufficient for major long-term financial goals like retirement.