The fund has a compound interest effect, and if the asset itself generates interest, it will have a compound interest effect.

Life is always visible, such as GDP. If an economy can maintain a growth rate of 3%, its economic weight will double after 23 years, because it is 1+0.3+0.3+0.3 ... but 1 * 1.03 23.

1000 yuan is deposited in the bank. If the bank can give you a fixed interest of 3% a year, after 23 years, 1000 yuan will become 2000 yuan.

If you invest in a fund, the fund manager will use your money to invest in companies in the stock market. To put it bluntly, it is actually investing in enterprises, just like looking at business.

Of course, the key is to see if you understand the investment business. If you don't understand, invest in the broad base index. In any case, China's economy as a whole is developing forward.

because ..

If you make a profit, you will take a profit? I have seen a boss who said, "Let's make less money and sell the company to others" when the company is booming and the industry prospect is clear.

Not paying dividends is a bad fund, which may or may not be. ...

Just like when you open a factory, after two years, you find that there is still a market to be developed, but if you want to invest the money earned this year in the production line, will you still spend it to borrow other people's money, or will you not develop it at all?

Take fund products as an example. If you invest 1 yuan in a dividend reinvestment fund with an annualized income of 8%, 30 years later, the 1 yuan in your brokerage account will become 1.08 30 = 10 yuan, that is to say, there will be no dividends during these 30 years, and all dividends will be directly invested back.

If the fund fully distributes the income, that is, dividends, then you will always get the dividends you deserve in these 30 years, and then 1 yuan in your brokerage account will become 1+0.08X30 = 3.40 points after 30 years.

This does not mean that dividend reinvested products are superior to dividend products. Whether it is good or not depends entirely on the investor's personal situation-your age, investment period, investment goal and so on. For example, you may just start working and plan to save some money as your retirement reserve every month, which means that the investment period of your investment will be about 35 years, so the natural dividend reinvestment fund is more suitable for you. Dividend fund will be more meaningful to those who have no other income, but have a lot of deposits, so that these people can get considerable income through dividends every month. For example, people who have just retired, or people who have a lot of money and don't want to work.