Recently, someone asked whether α and β were good strategies. In fact, both α and β are mainstream strategies, which is also very important for us to choose funds. Bian Xiao sorted out the relationship between fund income and Alpha Beta here for your reference. I hope everyone will gain something in the reading process!

Why is the fund increase out of sync with the broader market?

Friends who have allocated funds may find that some funds are synchronized with the increase of the broader market, but sometimes, we will also encounter the situation that the trend of funds and the broader market is not completely synchronized.

For example, the market has risen, but the funds held have not risen much, or have risen more;

The market fell, and the funds held did not fall so much, or fell more.

Why is this happening?

In fact, the income sources of financial assets such as stocks are mainly divided into two aspects: one is beta income, which fluctuates with the market; The second is alpha income, which does not fluctuate with the market.

Beta income (market income)

We can regard beta income as a passive investment income, which represents the average market income obtained by taking market risks.

Beta income is relatively easy to obtain, for example, by allocating index funds, beta income can be obtained, so as to keep up with the rhythm of the market.

Alpha return (excess return)

Alpha income is the difference between the actual income of the fund and the beta income, and the beta income is the part where the investment income exceeds the market income.

Alpha income mainly depends on the active management ability of fund managers, which requires high ability of fund managers in stock selection and timing.

If the performance of a certain fund greatly exceeds the market average, it shows that the investment management ability of the fund manager in this period is more prominent.

How should investors choose?

For ordinary investors, if they only want to get the average return of the market, they can allocate broad-based index funds to keep up with the pace of the market.

The operation of index funds does not depend on the fund manager's stock selection ability, and the rate is relatively low, and the position is generally above 90%. When the market falls, they will not take the initiative to reduce their positions.

If you want to get excess returns beyond the market, you need to choose some excellent active management funds.

For these funds, the stronger their ability to surpass the benchmark index, the greater their alpha income contribution.

Therefore, when choosing actively managed funds, we can take the data beyond the benchmark as an important reference.

Generally speaking, index funds are more radical in unilateral or general rising market; In a volatile or structural market, actively managed funds with obvious returns are more likely to break through.

You can choose according to your risk tolerance and investment preference.

In the past two years, the returns of funds purchased by many investors are generally unsatisfactory. What caused the large losses of most funds? Mars, an analyst at Shanghai Securities Fund Evaluation Center, pointed out that, first of all, the essence of fund products is the combination of securities, and the performance of fund income is closely related to the performance of the underlying market. In the continuous decline of the stock market, it is difficult for equity funds and hybrid funds, which mainly invest in stocks, to achieve positive returns. In the case of rising stock market, most partial stock funds can often achieve positive returns. Therefore, it is impossible for funds to create myths and create high positive returns in the continuous decline of the market in recent years.

From the long-term performance, in most cases, the overall performance of funds is better than that of individual investors, especially in bull markets and volatile markets. For example, in 2006 and 2007, more than 80% of equity funds achieved a return of more than 100%, while the proportion of individual investors was less than 20 12 years. Nearly 50% of equity funds have achieved a return of 5% to 30%. According to the survey, more than 50% of individual investors have lost between 5% and 50%. Therefore, the fund is still a good investment tool for individual investors to participate in the capital market.

All kinds of problems, whether China's stock market construction, economic development or asset management industry, can't be eliminated in a short time, and all need the rationality of the market as a whole to promote it. However, as investors themselves, we must measure our risk tolerance clearly and not blindly listen to the propaganda of sales staff. If your risk tolerance is weak, or the funds you want to use in the short term, you can't invest too much in a single stock fund to avoid being greatly affected by the risk of stock market fluctuations. Therefore, for individual investors, it is more meaningful to have a long-term investment mentality, choose appropriate fund products according to their own risk tolerance and renewal, avoid excessive pursuit of popular funds with outstanding short-term returns, pay more attention to funds with relatively stable long-term performance, and spread risks through fixed investment and portfolio allocation to obtain long-term stable returns.

Tip:

First, we should pay attention to arranging the proportion of fund varieties according to our own risk tolerance and investment purpose. Choose the fund that suits you best, and set an investment ceiling when buying partial stock funds.

Second, be careful not to buy the wrong "fund". The popularity of funds has led to some fake and shoddy products "fishing in troubled waters", so we should pay attention to identification.

Third, pay attention to the post-maintenance of your account. Although the fund is worry-free, it should not be left unattended. Always pay attention to the new announcements on the fund website, so as to have a more comprehensive and timely understanding of the funds you hold.

Fourth, pay attention to buying funds, and don't care too much about the net value of funds. In fact, the fund's income is only related to the net growth rate. As long as the fund's net growth rate stays ahead, the income will naturally be high.

Fifth, we should be careful not to "love the new and hate the old" or blindly pursue new funds. Although the new fund has inherent advantages such as preferential prices, the old fund has long-term operating experience and reasonable positions, which is more worthy of attention and investment.

Sixth, we should be careful not to buy dividend funds unilaterally. Fund dividend is the return of investors' previous income, so it is more reasonable to change the dividend method to "dividend reinvestment" as far as possible.

Seventh, we should pay attention not to talk about heroes in the short term. It is obviously unscientific to judge the pros and cons of the fund by short-term ups and downs, and it is necessary to make a comprehensive evaluation of the fund in many aspects and conduct a long-term investigation.

Eighth, we should pay attention to the flexible choice of investment strategies such as steady and worry-free fixed investment and affordable and simple dividend transfer.

Articles related to fund income:

★ Introduction to Fund Investment

★ Fund investment income forecast in 2020

★202 1 100000 How much do you earn a year by buying funds?

★ Knowledge of fund investment skills and methods

★ Common sense of securities investment funds

★ When is the best time to buy funds?

★ Necessary "wealth" and "talent" for financial management

★ What are the key points for investors to buy funds?

★ Four common ways to buy funds