In fund investment, there are many reasons for losses, among which chasing the rise and killing the fall is one of the important reasons for our investment losses. So how to avoid chasing the rise and killing the fall in fund investment?

First, don’t chase short-term market hot spots

The cycle of short-term market hot spots is very short. Chasing short-term market hot spots will easily lead to us constantly chasing ups and downs.

Many investors have the habit of checking changes in fund rankings after the market closes, and include some funds with good short-term gains into self-selected funds. This results in funds with good short-term gains being seen. Buy.

If there are only short-term market hot spots, then the market style will switch at any time, and it is very difficult to accurately target the market hot spots every time.

Second, set a reasonable profit-taking target

In 2020, the average return rate of stock funds reached 42%, and many funds doubled their performance, which made many investors believe that, It is very simple to make money by buying equity funds, but you have too high expectations for the fund's income.

Excessive income expectations will lead to some wrong investment decisions, such as always feeling that one has made less or overestimating one's investment level, hoping to earn higher income through timing.

There is no perfect rule for the rise and fall of the market, and funds will not rise all the time.

From the long-term historical data, the average annualized rate of return of partial stock funds is 16.18%, and the average annualized rate of return of bond funds is 7.64%. We can use this as a reference. Based on the overall market situation during the year, set a reasonable profit-taking target.

Third, optimize asset allocation

The purpose of asset allocation is to spread risks. If we allocate only one type of asset in our investment, then our investment risk exposure It's very large, because a single asset cannot maintain a sustained rise.

So, maintain a reasonable asset allocation.

Fourth, build positions in batches

Excessive positions lead to high fluctuations in account profits and losses, or there is no funds when you want to add positions, which can easily lead to chasing ups and downs.

So, we can build positions in batches when building positions, and keep some bullets in our hands at any time. There is no need to adjust the position by redeeming and repurchasing.