First, it exposed the lack of risk awareness of investors.

It seems that the fixed investment fund is a sure-fire business. The first thing that comes to mind when investing is how much money you earn, not whether you can make money, whether you will lose money, how much you owe to losing money, and whether you can bear it.

Second, different assets have different risk-return attributes.

It is also an investment. One person buys technology stocks, one person buys bank stocks, or invests in different industry funds, theme funds, strategic funds, etc. And the risks and contingent benefits he faces will be very different.

Third, large-scale assets rotate with time.

This year is a big year for GEM stocks, and blue-chip stocks in the market are likely to perform well next year. The current market style advocates growth and may return to value one day. Moreover, there are unpredictable cyclical laws in economy, finance and stock market. Investors can never judge whether they are standing on the mountain, halfway up the mountain, or standing in a deep pit, nor can they judge whether they are standing in the right outlet and become lucky pigs taking off in a typhoon.

The last two problems mentioned above are the so-called "stock selection" and "timing" that we investors are familiar with. If investors can handle these two problems well, why worry that they can't be Buffett's second?

However, most people can't, which is why there is only one Warren in the world. Buffett, 89, can still go to the legendary swordsman. Fortunately, his old man recommended ordinary investors to invest in broad-based index funds. The expected value is to obtain the average return of the stock market, that is, the annualized rate of return is 8~20%.

In the opening, the investor's approach is "fixed investment". Now I want to add a restrictive object: broad-based index funds. After talking about the whole point, I suggest that ordinary investors "invest in broad-based index funds", and in a complete "smile curve" investment cycle, they can generally get an annualized investment income of more than 15~20%.

Compared with Buffett's annualized income of more than 20%, this level is naturally inferior, but it will certainly make more than 80% investors in China stock market laugh.

Below, we might as well take the benchmark of China's capital market value investment, the Shanghai and Shenzhen 300 Index, as an example to measure the return of fixed investment for one year through historical data.

The chart below shows the monthly trend chart of the Shanghai and Shenzhen 300 Index since 2005.

During the whole 15 period from April 2005 to March 2020, investors start to make fixed investment at any time and invest for one year according to the monthly fixed investment. The investment income they can obtain is shown in the curve below.

Explain the yield curve. The abscissa of the above figure is the start time of fixed investment, and the ordinate is the investment income of fixed investment for one year. For example, the value of the first yellow dot in the curve is 26.3%, which means that the investment income from April 2005 to April 2006 is 26.3%, and the fixed investment at this time is 12.

When we interpret the return curve of fixed investment, we must look at the overall situation, and don't just see how much income the investment may gain, regardless of the ostrich mentality of possible losses. In fact, a more scientific attitude is to regard investment income as a probability event.

In the above fixed investment income curve, there are 168 sample points, and the average sample value is 1 1%.

Of 168 sample points, 99 are greater than zero, that is, the probability of obtaining positive returns is 99/ 168=58.9%. Among them, the highest rate of return is 138.9%, which was obtained from August 2006 to July 2007 (red dot in the above picture). During this period, investors will make a fixed investment of 1 0,000 yuan per month and invest one-year principal of 1 0,2000 yuan, so the final investment income will be 1, 2000× 1.38.9% = 1 0,668 yuan.

Of the 168 sampling points, 69 are less than zero, which means that the probability of investment loss is 69/168 = 41.1%. Among them, the largest loss ratio is 53.2%, which is the result of one-year fixed investment from June 5438, 2007 to September 2008 (green dot above). During this period, if the investor makes a fixed investment of 1 1,000 yuan per month and invests one-year principal of 1 2,000 yuan, the investment loss at the end of the period will be 1 2,000× 53.2% = 6,384 yuan.

It can be seen that at different time points, the final outcome may vary widely. As far as this example is concerned, it is possible to gain a positive income of 138.9%, and it is also possible to lose more than half of the bitter wine.

Although the investment profit is gratifying, the loss cannot be completely avoided. Fortunately, the loss of fixed investment is not hopeless, and the best prescription is to give it time. In other words, time can definitely save your fixed investment.

In the worst case of the above-mentioned fixed investment, the monthly fixed investment of the Shanghai and Shenzhen 300 Index will start from June 65438+ 10, 2007, and may lose more than 50% by September 2008. However, if investors can continue to invest regularly every month, they will miraculously turn losses into profits along the following income curve and record a positive income of 33.2% in July 2009. Even completely losing humanity, if investors have patience beyond ordinary people and insist on fixed investment from April to May of 2065438+2005, they can get a positive return on investment of about 78%.

In the above example, the principle behind the fixed investment profit lies in the "smile curve".

From the trend chart of the Shanghai and Shenzhen 300 Index, the period between the two bull market highs, June 2007, 65438+ 10 and May 2005, 2065438+May, constitutes a "smile curve" of huge magnitude. The fixed investment during this period, regardless of the time of intervention or the frequency of fixed investment, will eventually be profitable.

Similarly, the current position of A shares is another "smile curve" investment cycle since 2065438+May 2005. As long as the correct high point of the "smile curve" is drawn when the bull market comes in the future, the fixed investment implemented during this period will definitely be profitable.

Finally, to sum up: one year's fixed investment time is too short, but the profit probability is close to 60%, the average annualized rate of return is about 1 1%, and the highest rate of return can exceed 100%. If the investment time is extended to 2~7 years, the probability of profit from fixed investment will increase to varying degrees, and it is more likely that there will be a big bull market every few years and a rich return on investment will be obtained.