In order to achieve safety, many investors will still set up profit-taking plans, and when the accumulated income reaches a certain level, they will redeem the principal and income, but the fixed investment plan will remain unchanged and continue to vote.
Can take profit really achieve investment goals better? Let's look at the results of backtesting through historical data.
Suppose that since 2003, the stock fund index of 1000 yuan will be fixed every month, and the principal and income will be redeemed whenever the cumulative rate of return reaches 20%. The fixed investment plan will not be terminated, and the fixed investment will continue to be deducted.
During the period of 2003-2020, the data showed that 20% income was realized nine times and profits were made successfully. It takes about 17 years to make a fixed investment with the profit-taking plan, and the accumulated income is 47045 yuan, the accumulated yield is 23%, and the average annualized rate of return is around.
The effect of income is not ideal.
If you don't set a take profit, but a long-term fixed investment, what is the result?
Similarly, from 2003 to 2020, we insist on a fixed monthly investment of 1 000 yuan, but there is no take profit. Compared with the average annualized rate of return, the cumulative rate of return of the final fixed investment is dwarfed, and the effect of income far exceeds the fixed investment plan with take profit.
Why is there such a result?
First, when a fixed investment is profitable, the principal is relatively small.
In several different bull market stages, the profit-taking target of 20% was achieved in just three or four months. At that time, the accumulated principal was less than 654.38+0 million yuan, and the income was naturally not much.
Second, profit-taking interrupts the compound interest effect.
Compound interest needs the cumulative effect of principal and time. Compound interest snowballs. The bigger the snowball, the shorter the time it takes to get bigger. At that time, every time you took profit, it was like starting snowballing again on the way, and it would take longer for the snowball to get bigger.
According to the return on investment formula: return income = principal * rate of return.
It is right for us to set the investment goal in the investment process, but to achieve the investment goal, we need to pay attention to two important factors, namely, the goal of principal accumulation and the goal of yield.
To achieve the big goal of investment income, two small goals are indispensable, and the rate of return reaches the goal, which only constitutes a necessary condition for achieving the investment goal. At the same time, we should pay attention to the principal accumulation of fixed investment.
Some people may worry that the future trend of the market will continue to rise, because this cannot be accurately judged.
In fact, the fixed investment of equity funds we participate in is to chase up listed companies. If listed companies will maintain good average profitability, the long-term trend of domestic equity investment will fluctuate upward in theory.
Therefore, in the face of changeable investment targets, it is the best choice to enjoy compound interest through long-term fixed investment.