What principles should we grasp in choosing funds

No matter what kind of investment tools, only suitable for their own, is the best. The same is true for investment funds. When choosing a suitable fund, we should follow the following three principles:

(1) Determine the nature of the funds: if all the money of daily household is used for investment, on the one hand, it is difficult for investors to maintain a calm investment. From a professional point of view, it is also unscientific.

(2) Determine the period of use of funds: open end funds can be purchased and redeemed every day, but investment funds should consider the medium and long term, preferably 3-5 years, or even longer. For example, if you are saving for young children to go to college, you can consider an equity fund for the purpose of long-term capital growth.

(3) Understand your financial goals: everyone will have different considerations when investing because of their age, income and family status. Generally speaking, young people who have just entered the society are more capable of taking risks than those who are about to retire, so they are suitable to choose high-yield and high-risk fund products.