Searching for "Fund Fixed Investment" in Zhihu, we can see that some users held a live knowledge broadcast with the theme of fund fixed investment, which attracted more than 5,000 participants. Its title is also very attractive: simply making money by stupid methods. I feel that as long as I make a fixed investment, it is like setting up a printing machine at home, and I can count money every day without thinking.
Under the topic of fixed fund investment, about 30,000 users are concerned, and there are more than 1 1,000 questions.
In the top ten rankings of Netease Cloud Classroom Investment and Financial Management Course, the third and sixth places are all about the fixed investment of the fund. On the financial website like Snowball, there are hundreds of articles and discussions about the fixed investment of the fund. It can be seen that many institutions or writers are pushing for the fixed investment of the fund, and at the same time, many readers and investors are very interested in the fixed investment fund.
This phenomenon is worrying. Many articles promoting the fixed investment of funds are very unprofessional and are suspected of misleading consumers. In response to this phenomenon, the author once wrote an article called "Why is it a bad idea for the fund to vote". However, there are also feedback from readers: I wrote this article too professionally, and they don't know much about it. I hope I can help them make it clear in simpler language. So in today's article, I will help you further analyze the pros and cons of the fund's fixed investment.
The fixed investment of funds is essentially an investment strategy to buy funds. There are many kinds of fixed investment, such as quantification, pricing, timing, fixed loss and so on. The fixed investment of the fund mentioned in this paper refers to the simplest quantitative purchase method: that is, to allocate part of the funds on time (such as 100 yuan per month) to buy a fund. No matter whether the market is good or bad, no matter whether the fund rises or falls, it will continue to buy for many years.
This method of purchasing funds quantitatively on time is one of the simplest fixed investment strategies. It is easier to understand the logic in this simple example, and then analyze those slightly more complicated examples.
Supporters of the fund's fixed investment will generally list the following benefits of these fixed investments:
1. Automatically deduct money from the account to buy funds every month, and form a good habit of small investment.
Young people have little balance every month, so they can only save a little every month, make a fixed investment and participate in investment activities.
3. In the long run, the stock market is rising, so you can get a good return on investment by insisting on fixed investment for a long time.
4. Fund fixed investment smile curve: insist on buying when the market falls, and profit when it rises in the future.
5. Financial Xiaobai doesn't know much about it. Fixed investment is a kind of "lazy method", which is suitable for investors who know nothing.
Let's help you analyze whether these statements are reasonable.
Articles 1 and 2 actually include two suggestions:
(1) Young people should form a good habit of saving, don't make ends meet, and don't spend too much.
(2) Early investment. Therefore, if you save hard-earned money when you are young (even if it is 100 yuan per month), you should call the fund company and buy the fund as soon as possible.
There is nothing wrong with the suggestion (1). A responsible adult should have restrained his desire for excessive consumption, and constantly improved his and his family's economic strength through the habit of saving. Most educated people in China should agree with such values.
The problem is that forming the habit of saving is not the same as buying funds with these savings. The money saved every month can be put in the bank, or Yu 'ebao, or fixed deposit/national debt.
Here, the sales team of the fund company cleverly confuses the two concepts of "saving" and "buying funds". So it is necessary to remind readers that it is a good thing to form the habit of saving. But saving money and buying a fund are two completely different things. Don't be fooled by this specious propaganda.
Now let's talk about suggestion (2): early investment.
This suggestion has a similar logic to the third reason mentioned above: in the long run, the stock market is always up. Therefore, if you start early, you can enjoy the return on investment brought by the stock market rise earlier. Buffett has written many articles emphasizing the importance of "compound interest". If you start investing a few years ago, you will get objective wealth 30 years later.
This proposal seems reasonable, but in fact there are the following problems:
First of all, this proposal contradicts the fourth reason mentioned above.
Is the stock market going up or down?
If it goes up, it is obvious that the return on investment bought at the beginning is better, and there is no so-called smile curve.
If it is down, then what long-term fixed investment do you still insist on? Tighten your belt every month, scrimp and save your hard-earned money. Is there any way to buy a long-term declining asset for the fund company?
I know that some friends who advocate fixed investment may be tempted to protest: the stock market will rise in the long run and fall in the short term. Therefore, the fixed investment can use the "smile curve" to reduce the purchase cost in the short term, and then get the long-term return on investment.
There is a proverb in English called "If it seems too good to be true, it is probably true". If you really have such a magical investment strategy, you can seize the band in the short term, buy low-priced assets, and then enjoy the long-term return on investment at the same time. Then maybe many professional investment institutions will flock to it. Have you ever heard of professional investment institutions such as pension funds, university foundations and large hedge funds to complete the investment? )
In my book "Why Fixed Investment of Funds is a Bad Idea", I have done a mathematical analysis in this respect. Whether the fixed investment can bring investors a better return on investment depends entirely on luck: if the market falls during the fixed investment period, investors can buy at a lower price, so they can get a better return on investment in the future. On the other hand, if the market rises during the fixed investment period, the cost paid by investors will be higher, so the return on investment will also be dragged down.
Secondly, there is no empirical evidence to support the hypothesis that the China stock market has been rising for a long time.
A very important logic behind early investment advice is that in the long run, stocks will rise. This rule does exist in developed countries.
As shown in the above figure, if we look back at the history of the United States over the past 200 years, we will find that the return on investment of stocks to investors is the best, which is about 6.6% per year after deducting inflation. Other assets in the same period, such as bonds, gold and cash, are not as good as stocks. Britain, France, Germany and other industrial countries have similar regulations. This is the logical cornerstone for "buying stocks early" to work in these countries.
But this rule is not obvious in China. If we calculate the return on assets of China 1993 to 20 16, we will find that the return on investment of stocks to investors is negative (excluding inflation), which is not as good as the national debt in the same period.
In other words, China's stock risk premium is negative. In China, taking risks in buying stocks will not bring investors a better return on investment than government bonds. On the contrary, the return of stocks is worse than that of national debt. So investors took those extra risks in vain and didn't get the corresponding compensation.
This problem is also analyzed in the first section of the online open class "Little Turtle Asset Allocation" that I teach. Interested friends can have a look (free preview).
Of course, some friends may say that the history of the past 20 years does not necessarily mean that buying stocks will not make money in the future. Indeed, the China stock market has its particularity. Compared with developed countries, the history of China's stock market is much shorter, and the country's economic environment has also changed greatly during this period. Various laws and regulations related to listed companies often have a big change in a few years. Therefore, the historical rate of return in the past 20 years or so may not have much predictive effect on the future.
But if we want to make a scientific prediction, we need to collect as much information as possible and make some judgments based on the longest history. What I want to emphasize here is that the return of China stock market in the past 20 years is not good, which is worse than bonds. Don't blindly think that the return on investment of stocks will be good in the long run. This rule has not been reflected in China.
Another big difference between China market and foreign market lies in the influence of tax.
Many British and Americans do invest in stock funds/index funds in their retirement accounts (40 1k, pension accounts, etc.). But this is determined by the special national conditions of their country.
Take retirement accounts in Britain as an example. In order to encourage British people to save and plan for future retirement, the government gives tax incentives to pension accounts. As we all know, the income tax in Britain is very high. Income tax can be deducted by depositing part of surplus savings into pension account every year. So many British people will choose to do this. If you don't have these income tax deductions, why do you do it? There is no reason.
Secondly, the money in the UK tax-free retirement account cannot be used to buy a house. Only until retirement. Therefore, some British people will choose to invest these savings in funds on a regular basis. Anyway, it can't be used, and it can only be taken out after 60 years old. Its investment cycle is long (30~40 years from the age of 20), so it is reasonable to buy low-cost stock index funds/ETFs through fixed investment.
The problem is that these conditions are different from those of China investors. The situation in China is different from that in Britain, whether it is tax incentives or housing purchase policies. How can I copy them completely? China has the special national conditions of China. We can't copy some foreign investment methods, use them intact and sell them to young people with limited financial knowledge. I also hope that readers of this article can be more careful and rely on independent thinking to help them draw more rational conclusions.
Thirdly, if we carefully analyze the proposal of fixed investment of this fund, we will find that it is not suitable for the specific situation of young people at all.
Let's take an example of ordinary young people to analyze the truth.
Suppose this young man graduated from college at the age of 22. If some young people choose to continue their studies (graduate school, PhD, going abroad, etc.). ), then their graduation age needs to be delayed to 25 or even later.
In the first few years after graduation, most young people are busy with choosing jobs and spouses. Some people with better economic conditions may buy a car.
Then let's assume that the young man will get married around 28/29. From this time on, you will find that this young man needs a lot of money. He needs the money to get married, buy a house (the first wedding room he bought in his life), give birth to a baby, and then send the baby to a nursery/kindergarten. If you choose to have a second child, you need to repeat it.
It can be seen from this that young people in China, if not the rich second generation, come from industries with particularly high salaries (such as BAT, the upper-middle class of top investment banks), and most of them are short of money at the age of 29-35. In the matter of buying a house, many cases are parental support+bank loans.
Now let's assume that this young man started voting at the age of 23/24. Get married and buy a house after five years of fixed investment (29 years old). When money is most scarce, the money he gave to the fund company through fixed investment is not used. The main reasons are:
The stock market, especially the China stock market, has great volatility and unpredictability. Four to five years later, the stock market may be a big bull or a big bear, or it may not rise or fall.
As shown in the above figure, if a young person starts to make a fixed investment in 2006, he is likely to lose money in 20 1 1 year five years later. Of course, if young people are lucky, they will make a lot of money by starting to make a fixed investment in 2002 and then selling it at the peak in 2007 five years later. But this has nothing to do with the fixed investment at all, but he is particularly lucky. Just when he needed money, the stock market peaked.
The second reason why the fixed investment funds cannot be taken out is the purpose of fixed investment.
Fixed investment has been promoting the concept of "long-term investment" from beginning to end, encouraging young people to increase their savings and make plans for future retirement. How to use it around 30 years old? Doesn't this violate the original fixed investment goal?
Therefore, those young people who participate in the fixed investment will be in a very embarrassing state between the ages of 28 and 35: on the one hand, they owe money to the bank and their parents (although parents are willing to support their children to buy a house for free, you must at least make the accounts clear), and pay interest to the bank; On the other hand, they don't need their own cash savings, and they have to pay monthly contributions to the fund company every month.
This situation is obviously unreasonable. A more rational choice is to work hard before buying the first wedding room, strive for a reasonable salary increase and save, and then try to buy the first suite through your own efforts (supplemented by parental sponsorship and bank loans). Then, when there is a monthly cash flow balance, we will consider investing.
The sales staff of fund companies and some so-called "big V" on the Internet specifically aim at those young people under the age of 30, advocating them to buy funds and vote. This phenomenon is worrying. For these young people, the fund company is like the tax bureau, drawing a tax from his salary every month. From the perspective of fund companies, we can generally understand their motives. A young man has been buying funds regularly every month since he was in his twenties, regardless of wind and rain and fund performance, insisting on buying funds for more than ten years or even longer. Where can I find such a loyal customer? It is simply a class A customer. Therefore, fund companies and some internet giants spare no effort to publicize the fund's fixed investment, which has its strong economic incentives behind it. But as an ordinary investor, if you follow them and are fooled, you can only blame yourself.
Let's talk about the fifth reason mentioned above: financial xiaobai doesn't know much, and fixed investment is a kind of "lazy method", which is suitable for investors who don't know anything.
First of all, we should judge whether an investment strategy is good or not. Its standard should be: How high is the investment cost? How good is the return on investment? How big is the risk? Is it the best investment strategy suitable for investors' personal family situation? Not whether it is suitable for "lazy fools".
Secondly, if it is a long-term fixed investment (such as a fixed investment of more than 20 years), then investors need to confirm that the fund/fund company that has been fixed investment can exist for more than 20 years. This is a big challenge in China (the first open Public Offering of Fund was established in 200 1, which means that the oldest fund is less than 20 years old). If you decide to invest in10 ~ a fund company that will close down after 20 years, the blow to investors will be devastating. Most small investors don't even know the difference between closed-end funds and open-end funds, let alone have the knowledge and energy to make such a judgment.
Suppose a fund Xiaobai bought a fund through fixed investment. Xiaobai's starting point is: worry, save trouble, and sit and make money. Now let's assume that by 2007, or 20 15 years, the net value of the fund will suddenly drop by 20%, 30% or even more. Let's ask ourselves, can this little white still calmly continue to stick to his fixed investment plan? To tell the truth, the first reaction of most ordinary people must be to throw the fund out and put it in the bag. The so-called "plan for retirement" fixed investment plan actually earned the management fee of Xiaobai investors for several years under these excuses.
Some so-called "Internet Big V" promote various investment strategies or funds according to the number of their fans, and even many people believe it, which also reflects the current situation of too many "small white investments" in China. In my opinion, we should at least do the following due diligence before we believe the information posted by any user on the Internet or follow his/her advice to engage in some investment activities:
1) Personal information: What is the other party's surname, occupation, company name and education? Work experience? What are the professional qualifications? Is there a company website?
I have seen many big V's on many websites and many fans, but you can't find anything except a flower name when you check each other's information. Do you believe the advice given by such users?
Investment and financial management involves our hard-earned money, which reflects not only our responsibility to ourselves, but also our responsibility to our loved ones (lovers, children and the elderly). It is a very irresponsible investment attitude to follow a user who doesn't even know his real name online to buy this and that.
2) Knowledge system: Has the other party received professional training? Have you published any related books? Is the article logical and credible?
3) Investment ability: How many years of investment experience does the other party have? How much is the management? What is the return on investment? How big is the research team and how to put it into research?
4) Investment concept: Does the other party have a complete investment concept? Does this investment philosophy conform to some famous investment methods? Is there any empirical support?
In this world, there are few "pies falling from the sky". If you want to save trouble and don't spend time and energy to do the most basic learning and understanding, then the price is being fooled by people or institutions with ulterior motives.
Some friends may ask, what should I do?
My suggestions are as follows:
First of all, every investor needs to analyze his financial situation. Especially for young people, the first goal they need to achieve is to meet the immediate needs (such as buying a wedding room).
At the same time, young people should read some investment books in their spare time and arm themselves with knowledge. You don't need to be a financial expert, but at least you need to know some basic knowledge.
Before considering their own investment decisions, it is best for investors' household income and expenditure to reach positive cash flow. If the monthly life is relatively tight, after deducting the mortgage and daily expenses, there is not much left, then you should try to live your life first.
After meeting the above conditions, you can start to consider investment. The funds a person chooses to invest should be limited to what he can afford.
To put it bluntly, even if all the money you spent on stocks/funds/wealth management products is gone (financial crisis/fraud/default, etc. ), it should not affect the basic life of you and your wife and children.
I know many people don't understand this truth. Their logic is: isn't investment just to make money? It is because I have no money that I invest!
Unfortunately, this logic is wrong. Mainly because: First, investment is risky. There is no guarantee that you will succeed. If your money is used to buy a wedding room, or a school district room, or for your children to study abroad, these are very important living expenses, then these funds are only suitable for buying fixed-income assets (such as government bonds, guaranteed wealth management products, time deposits, etc.). ).
Secondly, the price of venture capital products will fluctuate. The more important money is to yourself, the less it can withstand fluctuations. Think about it, if this money is going to treat my parents, in case it falls by 10%, will you dare not throw it away? This is going to die! If you want to get high returns, you need to take risks. And the more you can afford high-risk funds, the more money you don't need.
Let me give you a simple example. Among the major investment institutions, the university endowment fund is the institution that can bear the investment risk best. This is mainly because the investment cycle of university foundation funds is eternal, and you can choose to participate in various high-risk investment activities for the longest time. In contrast, insurance companies and pension funds have to invest a large part of their funds in highly liquid fixed-income assets (such as national debt) because they have short-term and medium-term liabilities to deal with and cannot bear higher investment risks.
Next, for those investors with limited financial knowledge, the most suitable investment strategy is to establish a set of low-cost, diversified and decentralized investment strategies with cost control, systematic effectiveness and long-term persistence as the core. The specific details are introduced in detail in my book "Little Turtle Investment Wisdom", so I won't repeat them here.
Note: for the mathematical analysis of fixed investment, in my "Why is it a bad idea for funds to invest in fixed investment?" "has been explained, so I won't repeat it in this article.
I hope it will help everyone.
References:
Wu Zhijian: Little Turtle's investment wisdom: How to overcome the strong with the weak in investment?
Wu Zhijian: Little Turtle's Investment Wisdom II: The Survival Rule of Jungle Investment