What will happen if the fund buys too much?
Generally speaking, investors had better buy 3-5 funds. Too much or too little is problematic. Too little is difficult to achieve the role of risk diversification. Too much will have the following disadvantages:
1, wasting time and energy
Although fund investors are equivalent to indirectly participating in investment, they don't need to devote themselves to stocks, but they also need to analyze the trend of funds and industry competition. If the number of funds purchased at one time is too large, investors will not be able to take into account the development of each fund, which will take time and energy, and may even ignore the changes of one fund and lead to losses.
2. The income may be less.
When the market is good, buying too many foundations to spread the income may reduce the income of the funds to some extent. And if the market is not good, no matter how many funds you buy, you will still lose money. In contrast, the number of funds should not be too large, which can also save the cost of funds and leave some funds to deal with sudden risks in the later period.
3. The capital cost is high.
Fund transactions need to charge a certain fee. If you buy too many funds at the same time, the cost will add up to high, and more funds will be needed to solve it, which is not suitable for novice investors who have just started.
What should I pay attention to?
1. Avoid allocating a single fund.
When investing in diversified portfolio, it is best not to buy funds of the same type, industry and theme, otherwise their ups and downs are all in the United front, which is no different from buying funds and cannot achieve the function of diversifying risks. When the market is depressed, losses will still occur.
2. Control costs
Don't ignore the fee deduction of portfolio investment, and try to reduce transaction costs. Don't trade during the day.