Must Master Fund Investment Skills


Types of Investment Funds: Explained - Investment U

Improve investors' risk awareness

As an investment product, investment fund has both risks and benefits. Investors should bear the risk caused by market decline while enjoying the rising returns of the fund. Although fund investment can disperse investors' risks through portfolio investment, and its market risk is less than that of stocks, it does not mean that there is no risk in fund investment. We can say this: as a fund investor, if you can only enjoy 20% of the annual income brought by the investment fund and cannot bear 20% of the principal loss, the investor itself is not suitable for fund investment.

Establish the long-term investment concept of the fund

Investors who want to buy and hold good funds need the idea of long-term holding, instead of carrying out stock like "band operation". If they want to carry out band operation, they need a series of correct predictions, and they can't make mistakes. But it is very difficult to always sell high and buy low correctly. That is to say, we redeem the fund at a high level and buy it at a low point. The principle of this operation is very correct. The problem is how investors can judge accurately every time? However, it turned out to be self defeating, turning "high selling and low absorbing" into "low selling and high absorbing". In addition to the handling fees, 10% of the annual returns will be lost several times. Therefore, we suggest that fund investors should establish the concept of long-term holding of funds.

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Grasping the key to selecting investment fund varieties

Many fund investors like to buy newly issued funds and dislike the high net value of old funds. In fact, this will greatly affect the investment income of investors. Because the income of the fund investment comes from the growth rate of the fund during the holding period, the level of the net value of the fund does not have any impact on the fund appreciation. High net value funds are not equal to high investment costs. In a continuously rising market, the high net value of the fund is a direct reflection of its past investment ability, which means that the asset value contained in each fund is high, so it has a stronger advantage.

Make a good investment fund portfolio according to its own characteristics

Because each investor has different risk tolerance, life cycle, fund service life and risk preference, the types of investment funds will be different. For example, investors with low risk tolerance can invest in balanced, bond or principal guaranteed funds. Investors who like high risks will increase their investment in stock funds. However, no matter what kind of investors, they should adopt a diversified investment strategy. Both high-risk and low-risk fund varieties can be considered, but the proportion of investment is different. For fund investment for the elderly, more careful consideration should be given, in addition to the safety of the principal, Also consider the types of funds that will bring them considerable cash flow. For the selection of fund varieties, investors should pay more attention to index funds besides stock funds, allocation funds and bond funds. Index funds are funds that track specific market indexes, and can best enjoy the gains brought by the rise of the index in the bull market.


The above are the investment fund tips we summarized for you. I hope they can help you.

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