The famous American Professor Siegel has made a statistic: even if you are in the most wrong time *** index, from the 20th year you hold it, you will not lose money again.
In the short term, ** assets sometimes lose really badly, but in the long run, they are the assets with the best returns. If calculated on a 50-year cycle, the average annualized rate of return is almost a constant, about 10%, which is much higher than that of other investment varieties. To put it bluntly, investment is to allow us to earn the benefits of economic development, and it is also a "refuge" against inflation. If you want your money not to shrink, investing** is almost the only way out for you.
There are actually only two main reasons why we lose money when investing: buying too expensive, and selling too early.
1. It's too expensive to buy. Many novices who are new to investment always like to buy the top rankings. The reason why these ** can be on the list is precisely because their performance has skyrocketed in the short term, which makes many people rush to it. And this wrong way of chasing high and buying is to buy at the end of a wave of ** periods, so that you can take over at a high level, and finally catch up with a complete ** period. The investment market is a place where people compete with each other, and it must be the prophets who make the money of the latecomers. The only way to make money is to run ahead of others and let others follow your actions** and sell.
Second, it was sold too early. Even the best managers are unlikely to outperform the market at any given time. They have times when they "pass five levels and kill six generals", and they will also have times when they "defeat Maicheng". It's not scary to have a drawdown in an investment, it's scary to sell your chips when you pull back. Investment returns do not depend on the product itself, but on your knowledge and investment mentality. A person who is anxious for quick success and always wants to get rich overnight, even if he is given a cash cow, he will be burned by him as firewood. On the contrary, many mature investors, they never choose the hot**, and even choose some unpopular**, choose some products that have not performed well in the past six months. While these rarely skyrocket, the drawdowns are also much smaller each time.
So when is it easier to make money investing?Professional investors love bear markets. They actively sow seeds in bear markets and reap fruits in bull markets. Amateur investors, on the other hand, tend to be busy in a bull market, picking this and that. When it comes to the bear market, he scolds and leaves the market, and turns his investment into a loss-making business of buying high and selling low again and again.
The best time to invest is in a bear market. If you can lay out a good game in a bear market, the results are usually not too bad. When we reach the bull market, we should be conservative and start thinking about leaving the market at the right time. This is where investment is anti-human, because in the investment market, it is always a few people who make the money of the majority, which is doomed to us not to stand with the majority.