There are many kinds of assets in the world. If one day, you are asked to invest in only one asset, what is your choice?

You thought about it for a while, and suddenly a brainwave came to you, "I am my most precious asset, and of course I choose to invest in myself."

What a smart card. Rule out this answer? What we are talking about now is narrow and serious assets. What is your choice?

If the answer is not very clear, you might as well listen to the suggestion, that is, index funds-coincidentally, Buffett feels the same way.

So what is an index fund?

Have witty friends already planned Baidu? But! Being a mother is good, but why can't you understand it? I wrote a long paragraph and knew every word, but I was confused after reading it. Let's explain it in the popular version.

(does not mean strict definition, but helps to understand through analogy)

Index fund, simply put, is that one day, you come to a shelf with a vegetable basket, and the stocks of all listed companies are arranged on the shelf.

All you have to do is buy stocks on the shelf, but you can't just grab a handful and snore, because you have a shopping list in your hand.

The shopping list you usually make in the supermarket is as follows: tomatoes *5, green peppers *6, tenderloin *3, onions *2 and potatoes * 4. ...

The shopping list you have now is similar: A shares of listed companies *2, B shares of listed companies *3, C shares of listed companies *6 and D shares of listed companies * 7. ...

This shopping list is fixed. Whether you buy it, Xiao Ming or Han Meimei, you should strictly follow this shopping list.

This is the index fund, which combines the stocks of listed companies according to certain fixed and specific rules.

What's good about index funds?

In 2007, Buffett launched a gambling game: competing with fund managers, fund managers voluntarily choose stocks as fund portfolios instead of following the rules of indexes; Buffett only buys index funds, which will be decided according to their respective rates of return after a period of time.

Buffett is not a mortal, but these fund managers are by no means fish and shrimp. As far as China is concerned, most people who can become fund managers come from 985 in 985, and those who fly high.

The results are as follows: By the end of 20 16, the compound annual rate of return of Buffett Index Fund was 7.1%; The fund portfolio selected by the fund manager has a yield of only 2.2%.

There is no doubt that Buffett won and won easily. We should know that it takes a lot of time, energy, manpower and material resources for fund managers to choose stocks to form a fund portfolio.

They want to go to various companies to inspect the actual operation, and they need to pay attention to the financial status and operation status of each company, as well as the ranking of funds in the same category and the quarterly or semi-annual position adjustment.

Therefore, this is worse than index funds that only make stupid investments. This result ... is really sad.

Are you willing to pay attention to the financial status and operation of each company, pay attention to the ranking of funds in the same category, and adjust your positions every quarter or every six months, but after a lot of efforts, are you still not as good as an idle index fund?

Come and study ~

There is a saying in the financial market: "Seven losses, two draws and one profit."

In other words, 65,438+00% people can make money in the financial market, and the actual situation may be lower than this ratio. However, investment index funds can easily squeeze into this "one profit".

Moreover, the risks are controllable, and there are no ups and downs of dog blood elements such as borrowing money, selling houses, losing money, losing a wife, jumping off a building, making a comeback, and coming back to life.

So if you can only invest in one asset instead of an index fund, what else should you choose? That's what Buffett told his children.

Forget it. Let's invest in index funds.

Want to know more about the knowledge and investment methods of funds and index funds, pay attention to "Chengdu Branch of Pattern University" and start learning, and the gains are absolutely valuable ~