Recently, the equity market has been up and down, and investors may find that the gains accumulated in the market in the past few years have been reversed, because the actual holding yield is equal to the growth rate of the net value - trading loss, so there is always a difference between the actual rate of return of the investor's account and the growth rate of the net worth. For example, Jimin Xiaowei bought 200,000 ** at the beginning of the year, and the net value of the ** rose by 25% a year later, which encouraged Xiaowei to invest an additional 750,000 yuan to buy the same ** at the end of the year, making up an ** asset of 1 million. But it backfired, the second year** lost 20%, * assets shrank to 800,000, Xiao Wei lost confidence at the end of the second year and redeemed 750,000 yuanIn the third year, the **net worth**20%, Xiaowei's **assets are 60,000 yuan. Based on the three-year performance, the **net worth** increased by 20%, but Xiaowei lost 140,000.
It can be seen that there is still a long way to go from the growth rate of net worth to our actual holding yield, and most people ignore the "killer" that reduces our actual yield - transaction loss.
Next, we will analyze the underlying causes of trading loss:
First of all, we believe that high risk brings high returns. Even if investors take on high risks, they may not be able to enjoy high returns. High risk** is usually characterized by high volatility, which is an important factor in the loss of trades. Logically speaking, if the volatility of a ** is low, then the holder will be more peaceful when ** and sell**, and the probability of obtaining a positive return will increase;If the volatility is high, then the style of such ** will be more extreme, and it is difficult for holders to grasp the buying and selling points of such **, thereby magnifying the transaction loss and resulting in a decline in the real rate of return. Secondly, frequently chase hot spots to adjust investment. We may often find that there are ** just in line with the short-term hot spots of the market, and the recent performance is better than the ** we have, and we can't resist the urge to "change cars". However, frequent replacement** often results in higher transaction losses. Even the best manager often can't maintain excellent performance at any time, constantly buying high and selling low, no matter how good the performance is, it is difficult to make money by taking this way of operation. Because of this, FOF may be a more suitable variety for mass investors: FOF can help select excellent and match it, and when the market style changes, a professional manager will undertake the work of adjusting the portfolio, without the need for investors to change frequently.
FOF** allows for better risk diversification by diversifying across multiple assets and multiple investment strategies, which can reduce portfolio volatility.
FOF** usually sets a certain holding period, which can change the trading behavior of investors with high turnover to reduce trading losses and achieve longer-term investment goals.
Article**: China ** Daily).