After we buy an index fund, we will start to consider when this index fund can be sold. Do you want to sell it when you make money? Lose money. Do you want to sell it? I haven't made any money or lost any money since I held it for a long time. Do you want to sell it? There are certain preconditions for selling index funds. You can consider the following three aspects to decide whether to sell your index fund.

The first reference condition: the index is overvalued

The price always fluctuates around the value, that is, the price of index funds is sometimes higher than the value and sometimes lower than the value. If you buy a fund when the price is higher than the value, it is "expensive". When the price is higher than the value, that is, when the valuation is too high, the investment value of the fund will decline. In 2007, the P/E ratio of domestic index funds at that time was mostly above 40, which was overvalued and could be sold. We can take the profit rate of return as a reference for the valuation standard. When the rate of return is lower than 6.4%, it shows that the index fund is overvalued and can be considered for sale.

The second reference condition: there are better alternative varieties.

When you hold an index fund, there is not much problem with this fund, and the valuation is relatively normal in all aspects. But at this time, you find a fund of the same type, that is, the investment strategy of the index type is very similar, but this new fund is relatively cheap, that is, the valuation is lower. At this time, you can consider replacing the fund in your hand with a new fund. If the valuation of a variety is much lower than the fund you originally held, we can sell the fund and exchange it for a new fund.

The third condition: achieve profit-taking or investment goals.

The investment of index funds pays attention to long-term persistence, but it does not mean that it must be held foolishly. When we start investing in funds, we should set an investment goal or profit point for our investment plan. When the market environment is good and the fund reaches the profit point or investment target quickly, we should redeem the fund decisively and then consider entering the next round of investment instead of holding it foolishly.

The fourth condition: deterioration of fundamentals.

For index funds, fundamentals are the biggest influencing factor. Fundamentals are closely related to a country's macro-economy. If you believe that the country's economy can develop in a good direction for a long time, then the fundamentals will also perform well, and the corresponding index funds will have long-term growth space in the future. If not, consider selling it.

We can consider selling all the above four conditions. I am optimistic about the domestic economic development. Therefore, for the fourth condition of fundamental deterioration, don't use domestic index funds, which will fluctuate in the short term, but it will be good in the long run.