How to make investment for beginners?

"The risk of investing in stocks is very high!" I think this sentence should have been deeply imprinted in everyone's brains! But if you tell you this time, in fact, if there are investment tools in the world that are correct, the chance of making money is basically approaching 100%.

You may be very repulsive when you hear this. When people who are in charge of wealth hear the words "must-win investment method" and "teach you how to get rich quickly", they will keep a certain degree of alert. Especially when I tell you here, there is such an investment that cannot be repaid, it is actually very similar to the verdict. But please be patient and listen to me and tell me. I believe that after reading this chapter in full, you will understand why this investment method will not be reduced!

?

ETF's full name Exchange Traded Fund is also called "stock index fund". In simple terms, it means "securitizing" the index. As for, what are the well-known indexes? In Taiwan, the most familiar ones are the Canadian stock price index, while the US stock market includes the Standard 500, the Nasdaq index and the Dock Industrial Index. In the news, I often hear how much the Taiwan stock market has risen, how much the US stock market has fallen, etc. In fact, these information describes the decline of the index.

ETF is to facilitate investors to diversify investment risks and live. In other words, an ETF is like a big bag, and this bag contains many kinds of stocks, so investors can buy a variety of stocks with less principal. In terms of content, it looks very much like a fund, but ETFs appear in the market in the form of stocks. In Taiwan, the most famous ETF is not Taiwan 50 (0050). In this ETF, there are about 49% of Taiwan's guardian sacred mountains; — Taiwan Electricity (2330), 4% of the joint ventures (2454), and 4% of the Duck Sea (2317), etc. Since this ETF is called Taiwan 50, it is obvious that this ETF is composed of 50 Taiwanese high-quality listed companies; the most well-known ETF in the United States is the Tup 500, and the Tup 500 can also be learned from the name that this ETF is composed of 500 high-quality companies in the United States.

Why can a good ETF make your investment safer?

The most well-known benefit of ETF is: spreading the risks. The necessary condition for diversifying risks is to make good asset allocation. If the capital is not small, there is no way to invest in too many different labels, which will only invest in a small number of stocks and increase risks; the emergence of ETFs will allow investors to invest in this large label with a small amount of money, so that investors do not have to bear unnecessary risks. I often describe the Tip 500 as the Cao Cao water army in the Red Cliff War, because the Tip 500 has all the best tags together, like the "link ship" of that year, and its characteristics are very similar. For example, the water army will encounter big waves, and the Target 500 will encounter financial aura. However, because the number of tags is very large, this ETF is very stable and will not cause vibration because of a small market situation, which will sink like a circular ship.

For novice investors, this tool is perfect. Someone may ask: "Didn't the circular ships that year be burned with fire? Will the 500 be in the same state?" As expected, when encountering a crooner-level super stock disaster, the 500 will also be hit a lot, but despite this, we still have a way to find a way to get rid of the condom, so we don't have to worry about the situation of money that will occur.

In addition to the right tools, you should also use the right method: regular and fixed amount

After understanding many tools, have you developed a desire for investment? If so, congratulations on taking the first step towards passive investment! Next, I want to share a tip for operation: regular and fixed amounts. As for the reason for this? It is very simple, because no matter how high the quality of the item you buy is, as long as the price is bought at a high point, it is a bad investment; in contrast, if you buy bad investment at a low price, it can actually be regarded as a successful investment. Therefore, we need to learn how to buy at a low point, but the problem is that the stock market is up and down every day, and no one can really predict the future (to say it is precise, it is impossible to predict extremely short-term moves); that is, we will never know where the current price is in history, so it will be very stable by adopting regular fixed amounts.

Let me analyze what impact will regular amounts bring to our investment? First of all, since the investment we set is 0050 or S&P500 (Tag 500), we can highly recommend that if we pull the time line back for several decades, it will definitely be a historical low point. Take S&P500 as an example. Since 1981, the share price of S&P500 has risen all the way, up by about 8.5 times, but along the way, it is not a waste of money. S&P500 has experienced three sharp declines, namely 2000, 2008 and 2020.

In other words, in addition to the big disasters in history, S&P500 is basically rising all the way, so with the continuous development of the US economy, the future trend of S&P500 can be predicted.. In this case, using regular fixed amounts is the smartest. If you unfortunately encounter a stock disaster or bear market 1, you can buy it smoothly and buy the best label at the most favorable price; if you encounter a bull market 2, you can buy it all the way up and make profits with the market. In addition, current bank APPs can set regular fixed amounts, which is very convenient. Basically, as long as it is set once, the bank will help you execute. If you encounter any situation, if you want to execute the sale or increase your purchasing efforts, you can make easy adjustments. Moreover, since our goal is to buy online at a low point in history time on a regular basis, we don’t have to watch every day after placing an order. If it falls, that's great, because that means you can buy it at a cheaper price next time; if it goes up, then make money. In a different sentence, no matter what happens, it is worthy of congratulations, so you can invest with confidence, and don’t be afraid that the market shaking will affect your daily mood.

※This article excerpts from the naturalistic theory: If the ultimate goal is financial freedom, it is better to study investment and make money from the beginning! ! :X-Practical Methods for Thinking about Getting Rich》