Only index funds can judge whether it is undervalued or overvalued. The way to judge whether the index fund is overvalued is to look at the historical quantile of the index fund valuation level. Generally, being lower than the historical average means underestimation, and vice versa.

Other types of funds can't judge whether they are undervalued or overvalued, because other types of funds switch positions. The positions of index funds are relatively fixed, and the general index changes little. Underestimation or overvaluation can be used as a reference for investors to invest in index funds.

Matters needing attention of the fund

1. Pay attention to the proportion of fund types according to your risk tolerance and investment purpose. Choose the fund that suits you best, and set an investment ceiling when buying partial stock funds.

2. Be careful not to buy the wrong fund ". The popularity of the fund has attracted some fake and inferior products to fish in troubled waters, so we should pay attention to identification.

3. Pay attention to the later maintenance of your account. Although the fund is worry-free, it should not be left unattended. Always pay attention to the new announcements on the fund website, so as to have a more comprehensive and timely understanding of the funds you hold.