If the fund buys stocks in an industry within a certain period of time, it will exceed the established proportion.
For example, a fund generally buys 1 coal stocks, but coal stocks have performed well recently.
A fund bought three coal stocks, and the number is large, so this is over-matching, in fact, the essence is
Repeated investment, at best, is called over-allocation, at worst, it is reorganization, centralized investment, betting and radicalization.
Over-allocation of funds has generally increased a lot? Why? Because excessive fund buying will definitely push up.
Stock price, so when the over-allocation is completed, the stock price has already completed the main increase. So there is hope that the over-allocated stocks will continue to skyrocket in the future? Generally impossible. Because the fund has been over-allocated, it is unlikely that it will continue to be over-allocated. On the contrary,
Centralized lightening to rational allocation is a trend, and lightening is a decline.
Therefore, over-allocation stocks generally do not increase much in the later period. Overallocation can only explain which stocks the fund is optimistic about in the previous stage.
Can't represent which stocks the fund is optimistic about in the future. Don't be misled.