Advantages and disadvantages of index funds:
superiority
1, human factors have little influence.
2. This ratio is very low. The subscription and redemption rate of general stock funds is 1- 1.5%, and that of index funds is 0.5- 1.2%.
3, passive tracking index personal finance calculator, very intuitive. It is also suitable for short-wave band operation.
4. Long-term investment has low risk and excellent return.
disadvantaged
1, the fluctuation is too large. For short-term operation, the risk is great.
2. lead the rise but not resist the decline. In any market, index funds are high positions, and it is impossible to avoid the risk of the stock market through the operation of fund managers.
3. The risk of fund redemption. If you want to quit early, you have to sell at a low level, which is easy to lose money.
4. The fixed investment of the fund is not applicable in all cases, and the effect is very different.
How about investing in index funds?
Index fund is the first choice for fixed investment, because it is less interfered by human factors and only passively tracks the index. In the case of long-term economic growth in China, long-term fixed investment is bound to obtain better expected annualized expected returns. Active funds are greatly influenced by fund managers, and the performance of active funds in China is not ideal in terms of sustainability. Often the champion of the previous year is poor in the second year, and changing fund managers may also cause performance fluctuations. Therefore, if you hold it for a long time, it is better to choose an index fund. If there is a rebound, index funds should be the first choice.