1. Compound interest refers to the calculation of interest by adding the principal and the total interest accumulated in the previous period to calculate the interest in a certain interest period, also known as "interest means interest" and "rolling interest".
2. Fixed investment is the abbreviation of fixed-term investment fund, which means that a fixed amount (such as 500 yuan) is invested in a designated open-end fund at a fixed time (such as the 8th of each month), which is similar to the bank's deposit and withdrawal method. People usually refer to funds mainly as securities investment funds.
3. The regular investment of the fund is similar to long-term savings, which can spread the investment cost equally and reduce the overall risk. It has the function of automatically increasing the price and reducing the price on dips. No matter how the market price changes, it can always get a relatively low average cost. Therefore, regular fixed investment can smooth the peaks and valleys of the fund's net value and eliminate market fluctuations. As long as the selected funds grow as a whole, investors will get relatively average returns without worrying about the timing of entering the market.
4. In emerging markets or small stock-based overseas funds with large fluctuations in medium and long-term fixed investment performance, investors can often accumulate more fund shares when the stock market falls because the stock market callback time is generally long and the speed is slow, but the rising stock market rises rapidly, so as to obtain a better return on investment when the stock market rebounds. According to Lipper Fund data, as of the end of June 2005 to the end of June 2008, the average return rate of investors who have continuously deducted money to invest in any emerging market or small company stock fund in these three years is at least 23%.
5. Fixed-term investment funds only need investors to go through one-time procedures at the fund agency, and then they will automatically subscribe for each installment, usually on a monthly basis, but there are also other time limits such as semi-monthly and quarterly as regular units. In contrast, buying a fund by yourself requires investors to go through the formalities in person at the agency every time. Therefore, the fixed investment fund is also called "lazy financial management", which fully embodies its convenient characteristics.