Red and green are used for the following reasons:
1. From the perspective of chromatics, red means expansion and celebration, and green means calm and tranquility.
2. Choose red and green to form a sharp contrast, which is convenient for investors to watch.
Which is bigger, net worth estimation or net worth? Look at the valuation before buying a fund. When the fund is overvalued, the investment risk is high (purchase is not recommended). When the fund is undervalued, it shows that the fund has investment value and high profit probability (can be bought).
Look at the net value after buying a fund. The income of the fund is mainly determined by the rise and fall of the net value. When the net value of the fund rises, the fund gains, and when the net value of the fund falls, the fund loses.
What is the impact of overvaluation of index funds? The high valuation of index funds means that the index has risen by a large margin, which may be overestimated and the market may fall in the future. When it falls, investors will face huge losses. If there is no time to sell, the initial profit may turn into a loss. Therefore, when the index is overvalued, you can take profit appropriately.
Investors can judge whether the valuation of index funds is too high in the following ways:
1, Alipay or Tian Tian Fund has the function of "index traffic light" or "index valuation". This function will directly indicate whether the fund is in the overvalued area, undervalued area or normal area.
2. Check the PE(PB) quantile of the fund: the lower the PE(PB) quantile, the more suitable it is to buy; The higher the percentage value of PE(PB), the more suitable for selling.
General: when the percentage of PE or PB is less than 20%, it means that it is underestimated; When its percentile is higher than 80%, it means it is overvalued; The reasonable range is between 20% and 80%.
3. Direct comparison between industrial funds and industrial PE. If it is higher than the industry average, the fund may be overvalued; If it is lower than the industry average, it may be underestimated.