Financial investment actually has a hierarchy of discrimination. Futures traders look down on stock investors, and stock investors look down on fund investors. Today we are not discussing futures traders, as they are a small group. Let's talk about the large number of stock investors and fund investors, and why stock investors look down on fund investors.
I entered the stock market in 1996 and have been a stock investor ever since. Later, the A-share market also started to have funds, but I never bought any funds. Because I looked down on funds, thinking that the investment returns of funds are low, and I thought that fund investors are a group of investment novices.
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Many years later, the facts have proven that my cognition is problematic. One year, the A-share market launched a big bull market, and I saw many fund investors earning more than 60% on the Internet, and even doubling. I felt that this was impossible! Absolutely impossible! Because at that time, I had only earned more than 30%. I believe that my investment level can easily crush these fund investors.
Until one day, I accidentally looked at the fund's rise in the ranking list. I was surprised to find that the returns of fund investment are not low! Many funds' net value at that time rose by more than 3% every day. Some funds have already doubled their profits.
This made me realize a problem - individual stock trading may not necessarily be able to defeat funds. Because fund investment is a sector. For example, the liquor index fund invests in almost all liquor stocks. Therefore, when the liquor sector rises, the fund investors holding the liquor index fund can obtain the average return of the liquor sector's rise.
But our stock investors' final investment returns if they buy liquor stocks on their own may not be certain. The one or two liquor stocks we buy may have a rise far behind the average rise of the liquor sector. That is to say, the final profit or loss of our stock investors' investment in specific stocks has a strong element of luck. When we are lucky, our investment performance can kill fund investors, and when we are unlucky, the investment performance of fund investors can kill our stock investors!
The investment returns of fund investors are relatively stable. Because the fund manager's position is usually more than a dozen or even thousands of stocks, the investment is relatively dispersed, and the investment returns obtained are generally the result of the rise or fall of the held more than a dozen or even thousands of stocks. Therefore, buying funds generally will not have the problem of choosing the wrong stock, and will not be too affected by the investment returns due to the collapse of one or two stocks in the position.
This advantage of funds is something that ordinary stock investors find it difficult to have when trading stocks on their own. Unless ordinary stock investors do a good job in the investment portfolio. The problem is that most stock investors do not know how to make a good stock portfolio. Many stock investors only buy one or two stocks heavily.
Later, after reading some books on funds, I learned such a data: looking at the long term of several decades, passive index funds can defeat more than 95% of stock investors and the vast majority of active stock fund managers.Since then, I have come to value funds more and no longer dare to underestimate the investment in funds. Speaking of this, some stock investors will surely say: "The returns on A-share funds are very poor, I would rather lose money myself than hand it over to a fund manager."
What I want to say is: "Do not challenge others' livelihood with your hobbies." Although there are a few fund managers with subpar investment skills, the investment strength of most fund managers is definitely stronger than that of ordinary stock investors. Different professions are like different mountains. This truth remains unchanged through the ages.
As for fund investors, their investment capabilities are definitely far inferior to those of stock investors - I still believe this now. However, there is one point where fund investors are far superior to stock investors. That is, most fund investors have self-awareness, knowing that their investment skills are not good, and entrust their money to others to manage. Most stock investors, on the other hand, overestimate their abilities, and there are no shortage of arrogant people among them.
I dare say that if we take a 10-year period and calculate the proportion of profitable investors among stock investors and fund investors, the proportion of profitable stock investors will definitely be far less than that of fund investors. Most stock investors do not even understand the most basic investment knowledge and rush into the market with high hopes, and their final investment returns can be imagined. Fund investors are much better in this regard, as most of them at least know their own weight. Therefore, in the long run, the overall returns of fund investors are better than those of stock investors.
Note, this article is not an advertisement for funds, and there is not even a specific fund name in this article. This article aims to reveal a fact: most stock investors are arrogant and look down on fund investors. In reality, stock investment is a matter that requires high ability, and the vast majority of stock investors do not have the ability to do a good job in stock investment.
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