Although diversifying investment in different industries helps to spread risks, if the amount is small and the utilization rate of funds is not large, it is better to concentrate firepower. You can also diversify your risk by investing in a composite index fund.
An index fund refers to a fund that tracks an index. It lacks human intervention and follows the market, which is the luck of the country.
Funds with large fluctuations, such as index funds, are very suitable for fixed investment.
As for how to choose index funds?
1. Select type: the comprehensive index fund covers all walks of life, and the risk concentration is relatively low. The influencing factors of industry index funds are relatively single and the risks are concentrated.
Therefore, compared with industry index funds, comprehensive index funds are recommended. Of course, if you must choose industry index funds, choose those industries that are less affected by the economy.
2, depending on the time: it is best to operate for more than 3 years, open irregularly, and can apply for redemption at any time.
3. Look at the performance of the fund: if you choose to grow steadily in the past year, the income will be better.
4. Look at the fund manager: change the frequency (don't change it frequently), because index funds are completely passive, so index funds don't need to look at the maximum withdrawal rate.
Buffett has repeatedly advised investors: "Be sure to invest within your own understanding."
Sharpening a knife is not a mistake for a woodcutter. It's best to learn financial management knowledge before investing, and then invest clearly.