Buy The Dip
In short
Investors purchase more of an asset after its price has dropped significantly.
In plain words
When a stock or cryptocurrency loses value quickly, people buy it hoping the price will go back up. They view the lower price as a bargain or a discount.
A simple example
If a share costs £100 and suddenly falls to £70, an investor might buy more shares at this lower price. They hope to profit when the price eventually recovers to its original level.
Why it matters
It is a common strategy used to lower the average cost of an investment. However, it can be risky if the price continues to fall indefinitely.
Easy to mix up
Do not confuse this with 'catching a falling knife', which is buying an asset that is crashing without any sign of stopping.