While investors across the ocean were cheering for the U.S. stock market to emerge from the shadow of the financial crisis and achieve good gains (the S&P 500 rose 26.01% and the Dow Jones Industrial Index rose 18.82%), the Chinese stock market unexpectedly emerged with a stronger

bull market.

Morningstar China Market Index rose 103.24% in 2009, of which the Shanghai Composite Index rose 79.98% throughout the year, and the Shenzhen Component Index led the way with an increase of more than 117%.

Looking back on the first decade of this century, China's capital market has also experienced many ups and downs, including a five-year bear market starting in 2001, a brilliant overall return of more than 160% in 2007, and a crisis-ridden crisis.

A 63% plunge in 2008.

Of course, the glory of 2009 does not mean that everyone investing in any category of the capital market will receive the same returns.

For example, the Morningstar China Equity Fund Index rose by 70.72% last year, while the Morningstar Bond Fund Index gained 4.99%.

And the income varies from year to year, making it difficult to lock in an expected value.

We should also realize that the compilation of a certain index may not include all listed funds or stocks. In addition, there are often other investment categories in personal investment portfolios, such as money market funds, time deposits, or commodity futures, etc.

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It is for the above reasons that investors should not rely solely on the performance of the index to compare the performance of individual investments.

The volatility of the market is very unpredictable for individual investors, especially when there is not enough information to make judgments, it is a bit like shooting with blind eyes.

Investors may wish to refer to the following investment experience. These principles have operational value whether in a bear market or a bull market.

Enlightenment 1: Clarify the investment goals and choose the investment period. Many people spend too much time thinking about which fund they should hold or how to make money, but spend very little time considering other aspects of investment, such as investment goals and overall asset allocation.

Generally speaking, investment objectives will determine the investment portfolio and time horizon.

Everyone has unique financial targets that they need to meet, such as paying for their children's higher education, owning their own home, or providing money for retirement.

If you need money in two years or less, you might consider investing in a money market fund or a time deposit.

If you can wait two to three years, you can choose to invest in short-term bond funds or ultra-short-term bond funds.

Other types of investments will increase your investment risks.

On the other hand, if you are a younger investor preparing for retirement, you can concentrate all your investments in stocks.

But if your investment goal is short- to medium-term, it is not so certain whether the return from investing in stocks will be better than investing in bonds.

Of course, you must also face the fact that there is always the possibility that your investment choices will lag behind other categories.

The first lesson for individual investors is to understand their own investment goals and risk tolerance, and then choose investment types based on the above judgments.

Enlightenment 2: Average cost investment method Although funds have long-term investment characteristics and are less volatile than stocks, this does not mean that once a fund is selected, it can be settled once and for all, and the unique volatility of the capital market does not depend on choice.

While a single fund or stock can be completely avoided, there is a way to mitigate the risk of volatility.

For example, if you invest your pension through your employer's corporate annuity plan, it may have been invested in the securities market every time you get your paycheck.

In financial management terms, this practice of investing regularly is called dollar-cost averaging.

This approach allows investors to avoid overinvesting during market booms (because the fund or stock price rises, and you can only buy a small share each time you invest), and to invest more when the market is down (when the fund or stock price falls)

time, you can buy more shares with each investment).

Lesson 3: Save more (not just for now) In the run-up to the financial crisis, the amount of savings Chinese consumers, especially young people, had gradually decreased.

China's increasingly loose monetary policy has made it relatively easy to lend money, which has led to phenomena such as using credit card overdrafts to purchase lifestyles without the ability to consume, and housing loans exceeding personal income tolerance, etc.

If market volatility prevents personal investments from growing, the only way to make up for the shortfall in your life is to save more.

This brings us back to the pension account mentioned earlier.

Since the reform of the enterprise annuity policy in 2004, more and more companies, including foreign companies in China, have participated in this win-win investment model for both companies and employees.

The current policy allows each enterprise to contribute 1/12 of your previous year's income to your pension account every year. If added to the amount of your personal contribution, it can invest up to 1/6 of the previous year's income.

For example, if your income in 2009 is 60,000 yuan, your pension account can increase by 10,000 yuan a year.

According to conservative assumptions, if your pension account returns only 4% every year, then you should have at least 580,000 yuan in your account when you can start withdrawing your pension after 30 years.

Be sure to remember to invest enough to take advantage of this discount.