First, index funds with large fluctuations.
If you have a good theme and choose a fund with fixed investment, the investment will be half done. This is a fact. When choosing an index fund, should we choose a fund with large fluctuations or a fund with small fluctuations? Let's look at two sets of data models.
Index fund 1 and index fund 2 also start to make fixed investment when the net value is 2, with a fixed investment of 1000 yuan per month. After a round of fluctuation, the price returned to 2. By comparison, the fluctuation range of Fund 2 is greater than that of Fund 1, and the final total assets of Fund 2 can be seen that the total assets of Fund 2 are more than 300 yuan higher than that of Fund 1. The returns of index funds with large fluctuations are obviously higher than those of index funds with small fluctuations. Through constant fixed investment, we can get low prices in the bear market, dilute the cost and get a higher share. When the fund goes up, we can get higher returns. Therefore, funds with large fluctuations are more suitable for fixed investment.
The second is the index fund with higher growth rate.
Can volatile funds make money? This is uncertain. If the investment target is not good, it is difficult to make money. For example, an index fund suffered a long-term decline in the bear market, and then the market reversed, and there was no good trend, indicating that this is not a fund and it is difficult to make money. This has to mention the second rule of choosing index funds. Choose high-growth funds, and high-growth funds will gain more when they encounter a bull market. What is a high growth fund? Generally speaking, we believe that small-cap companies have higher growth. Let's compare the GEM index with the CSI 300 index. The average market value of GEM stocks is much lower than that of Shanghai and Shenzhen 300 constituent stocks. The data shows that the average annualized rate of return of investment in GEM index is 23%, while the average annualized rate of return of investment in CSI 300 index is 10%. Enterprises with small market value are more likely to be promoted by funds when encountering a bull market, so they will rise faster than enterprises with large market value.
Based on the above two points, we can consider choosing an index with high volatility and high growth to make a fixed investment. The higher the volatility, the higher the rate of return, while the high growth index with smaller market value has more room for profit in the future. The combination of the two may bring you unexpected surprises. At the same time, we should also note that high fluctuation and high growth also mean high risk, so we must measure our risk tolerance before making a choice.
The above is the analysis of what kind of index funds are most suitable for fixed investment, and I hope it will help you.