Category: Money Tips Date: 2006-11-20
"Buy low and sell high" is that many investors believe in investment strategy. Quotes characteristics of the shock this year to provide investors with a band for many operational reasons. However, we believe that, due to the Fund's own property, and the stock has a considerable difference between band operation on the vast majority of investors, is not appropriate for the vast majority of open-end fund products are not appropriate.
Although this year the stock market volatility has been quite large, the largest decline this year, a few days of view, "2.27", "4.19", "5.30" and "6.4" This is a four-day market's one-day declines, respectively, 8.84%, 4.52 %, 6.5% and 8.26%. Of the Fund is significantly less than the market decline, according to days relative to open-end fund index, the above-mentioned four-day declines of 7.44%, 3.45%, 5.03% and 5.54%. A group of blue-chip drop Fund Quotes demonstrated considerable resilience, so as to the last drop Quotes of view, the smallest decline in the fund is only about 3%.
Therefore, the first one-band operation difficult, even determine the success of the short-term market trends, the decline in the fund is usually less than the broader market, all the bands operating profit limited space.
The second point is also well known, the Fund's transaction costs than the stock is expensive. Stamp upward, the stock of bilateral transaction costs of 1% or so. Off-site purchase of the general fund transaction costs, that is, purchase of about 2% redemption rate, through the online trading system, then about 1.1%, so, further narrowing the profit margins.
Third, selecting the right of a throwing point, but often are not allowed to have something for the election, that is, the saying goes, are not allowed to ride rhythm. Generally speaking, once the markets have adjusted there will be repeated Quotes. Often happens, many investors think they copied the one end is a back stage look at "ceiling"; while the real bottom comes, the market was filled with a thick atmosphere of panic, most people in this case did not dare to intervene aggressively. Therefore, the so-called "selling points" and the "selling points" are fleeting, and even professional institutional investors find it difficult to accurately grasp, let alone the average investor.
The fourth point matters worse, even if the precise grasp of the "selling points" and "throw point", because most of the OTC Fund Redemption relatively long period, in 5-7 days, and so on redemption of funds has finally returned to your account at the time, or miss the best buying opportunity.
