When many people step into the investment field, they will ask, "What should I buy?"
At this time, they should ask themselves a question: "What is my investment goal?"
Many people's investment goals are vague: "The current interest rate of the bank is too low, and I want to find products with higher returns", "I also want to invest in fixed investment funds because my friend make a lot money from it", "Recently, the stock market has risen sharply, and I have to catch up with the market" etc.
If we set such investment goals, we will be in big trouble. Because the scope of your choices is too wide, you will have no idea to choose products.
You must have a similar experience in life. Originally, you just want to buy a coat, but when you go to the mall, you had no choice but to buy a dazzling new, classic and retro version of the season. This is a special term in psychology, called "decision-making paralysis".
To avoid "decision-making paralysis", we need to set more precise goals. If your goal setting is very precise, for example, if you want to buy a cashmere denim jacket, you will automatically filter out some products that should not be included in the decision-making scope, which is much easier to choose.
Investment is the same. Setting clear investment goals can help you make better investment decisions.
What is a clear investment objective? The more specific, the better. Different investment objectives will lead to different products suitable for you.
An investor's investment goal should include three elements: returns, time and risk.
Let's look at the returns first. There are three common returns goals:
1) Exceed the rate of inflation and gain 4%~6% of income;
2) Gain a small income of 8%~10%;
3) Achieve great success with an annualized yield of more than 20%.
Next, let's talk about risk and time.
If your risk tolerance is low and the investment period is short, you can choose monetary funds, bank wealth management and bond funds. If your risk tolerance is high and your investment period is long, you can consider hybrid funds, stock funds, stocks and other highly volatile products.
How to evaluate your ability to bear risks?
Risk tolerance is mainly related to three factors: wealth, expenditure and age. People with more wealth, people with abundant capital flow and young people will have a stronger ability to resist risks. They can withstand the high volatility of short-term assets and will not be emotional because of the sharp rise and fall of the stock market.
The majority of the elderly prefer stability and hope to preserve their wealth. They will not take high risks in order to earn more income. They will choose stable financial products. They are the main users of bank financial products.
We need to have a general understanding before we can make a good investment plan and select products that are suitable for us. Some people set an annual income target of more than 20% optimistically, which shows that they do not have basic investment knowledge.
In this case, the most important thing to do is to learn about the knowledge of investment, and know the people suitable for different products. Investment is a science, which requires full cognition to set goals that are suitable for you.
