Funds are also a common way to manage money, but buying and selling funds certainly requires certain skills, so when can the funds be sold? What should I pay attention to when buying funds? The following is analyzed by Bian Xiao.
What should I pay attention to when buying funds?
Investment objectives and risk tolerance: ensure that the selected fund is consistent with its own investment objectives and risk tolerance. Understand your investment objectives, investment duration and risk preference, and choose the fund type and strategy that suits you.
Historical performance and performance of the fund: evaluate the historical performance and performance of the fund, including annualized rate of return, risk-adjusted rate of return and relative performance. Focus on the performance of funds in different market environments, as well as the investment ability and experience of fund managers.
Fund fee and fee structure: Understand the fee structure of the fund, including management fee, custody fee and sales service fee. Fees will have an impact on investment income, so we should choose a fund with reasonable and transparent fees.
Scale and liquidity of the fund: Pay attention to the scale and liquidity of the fund. Larger funds may face liquidity risks in their operation, while smaller funds may have scale restrictions.
Risk warning and disclosure of the fund: read the risk warning and fund contract of the fund carefully to understand the risk characteristics and risk management measures of the fund. Understand the market risk, credit risk and liquidity risk that the fund may face.
Reputation and management ability of fund management companies and fund managers: understand the background, experience and performance of fund management companies and fund managers, and evaluate their ability and level of fund management.
Is it risky to buy a fund?
Market risk: the net value of the fund will be affected by market fluctuations, which may lead to the loss of investment principal and income.
Liquidity risk: some assets invested by funds may face the risk of insufficient liquidity, resulting in the inability to buy and sell fund shares in time.
Credit risk: The assets such as bonds invested by the Fund are at risk of default by the debtor, which may cause the Fund to suffer losses.
Why can fund trading make money?
The reason why fund trading can make money is because the fund's investment portfolio has made a return in the market. Fund managers use investors' funds to buy a basket of stocks, bonds, indexes and other assets, and create income for investors through the appreciation or dividends of these assets. When the asset price in the fund portfolio rises, the net value of the fund will also rise, and investors can make a profit by selling the fund shares.
However, fund trading is risky and investors may not always make money. The income of the fund is influenced by market factors, investment decision-making and execution ability of fund managers, asset allocation and dispersion and other factors. If the market falls or the fund's portfolio does not perform well, investors may suffer losses.
When is a good time to buy a fund?
Long-term investment: As a long-term investment tool, fund has the characteristics of smoothing market fluctuation and realizing long-term growth. Therefore, it is easier to obtain stable income by holding funds for a long time. Investors should make long-term investment plans, hold funds patiently, and don't blindly buy and sell because of short-term market fluctuations.
Buying at a low valuation: When the market underestimates the opportunity, buying a fund may be ideal. If the net value of the fund is underestimated and has good growth potential and investment value, investors can consider buying it in time.
Buffett's suggestion: Buffett is a famous investment master. He advised investors to "be greedy when others are afraid, and be afraid when others are greedy". This means that investors should buy more funds when the market panics, but they may need to be cautious when the market is too optimistic.
Diversified investment: investors can consider buying funds regularly through regular fixed investment and distributing funds in different types of funds, industries and regions to reduce specific risks and average risks.
When can the fund be sold?
General funds need to be sold on the next trading day after purchase, preferably between 2: 50 pm and 2: 59 pm on the trading day. The transactions of the fund before three o'clock shall be calculated according to the net value at the close of the day. At the end of the day, you can know the ups and downs of the fund that day by looking at the estimate of the fund's net value. If the fund goes up, you can choose to sell it and get more income. If it falls, it will be considered according to the actual situation.
The trading hours of the Fund are: 9: 30am-11:30am from Monday to Friday, and13:-15: 00pm in the afternoon. Trading is not allowed on weekends and legal holidays.