Dollar-Cost Averaging (DCA), also known as "averaging down" or "averaging up," is the practice of adding to an existing position as price moves against you (averaging down) or in your favor (averaging up).
MILTRADERS' position on DCA: DCA is permitted on MILTRADERS as long as it is part of a coherent, planned trading strategy. Many professional traders use scaling techniques as part of their risk management.
However, DCA used to "rescue" a losing trade — repeatedly adding to a losing position with no plan, hoping to break even — is considered gambling behavior and is not permitted. This includes patterns like:
Adding to a losing position multiple times without a defined invalidation level.
Using max-size DCA into news events or unstable conditions.
DCA combined with removing or moving stop-losses.
If our risk team detects patterns consistent with reckless averaging (e.g., escalating size with no stop, repeated bailouts on near-drawdown breaches), your account may be flagged for review.
In short: DCA as a planned scaling strategy = OK. DCA as emotional rescue = not allowed.