How do you know that the fund is at a low point?
Knowing the low point of the fund, we can observe the historical price trend of the fund, understand the fluctuation range and historical low point of the fund, and judge whether it is at a low point through the historical data of the fund. At the same time, observing the valuation level of the fund, such as the P/E ratio and P/B ratio of the fund, can judge whether the fund is undervalued compared with the historical average or similar funds.
The reasons why funds make more money by buying at low points are as follows:
1. Buy low and sell high: if you buy at the low point of the fund, you can enjoy the subsequent income, and when the fund price picks up, you can sell it for profit.
2. Diversified investment: Through fixed investment on a regular basis, investment risks can be diversified, concentrated investment at market highs can be avoided, and the risks brought by market fluctuations can be reduced.
3. Time effect: If you hold the fund for a long time, you can enjoy the compound interest effect brought by the time effect. By investing regularly, you can buy more stocks at low points, thus increasing long-term returns.
But in the economic market, its trend is uncertain, and there is no way to accurately predict the fund's low point.