How does the bear market fund operate?
In the bear market, fund investment can be traded in the form of fixed investment, and the share of positions can be increased by constantly buying funds on a regular basis, so as to share investment costs and spread investment risks. Once the fund starts to pull back, it will usher in good returns and realize the smile curve effect. However, when conducting a fixed investment transaction, it is still necessary to set a take profit point to ensure the income. The fixed investment of the fund has the characteristics of long-term, compound interest, cost sharing and risk dispersion, so the setting of stop loss is not so important.
General funds will have dividends. When paying dividends, investors can change the dividend method to dividend reinvestment. If there is no manual modification, the cash dividend method is usually the default. After the dividend is reinvested, it can get better compound interest effect. Funds with dividends are usually funds with good profitability and positive returns in the current year, so there is no need to worry too much about such funds continuing to hold in the bear market.
When choosing funds, investors can try to choose some funds with good historical performance, long experience as fund managers and great potential for industry development, as well as funds with low withdrawal rate, so that even in a bear market, the loss rate of funds will not be great.