Many people end up with losses in the stock market due to their attitude and mood. To have long-term investments and profits, you need to be mentally strong in the first place.
The concept of consistent investment in index funds is easy to understand. Actually, it has appeared for a long period. Decades ago, Benjamin Graham proposed similar strategies, which are effective in the main stock markets around the world. But why haven't such simple and resultful strategies become popular across the globe? Why are the investments we are making still closely related with concept speculation and instability?
The answer is simple: attitudes and moods. Even though the strategies provided by Graham are clear and concise, it requires us to have a strong will and consistent mind. Most of the time, we need to be free from any psychological disturbances of ourselves. In other words, it would be better for us to act and operate as a robot, mechanically and regularly. However, it is rather hard for many of us.
So how to keep a good mood in the stock market?
Try to invest in index funds from the perspective of purchasing assets. After making money in index funds, we will think about throwing away this "hot potato" for fear that the previous gains will be lost. In fact, index funds have been rising for a long time, which can provide good long-term returns in undervalued and normal valuation scopes. In other words, we subconsciously don't regard it as an asset that can be owned for a long time. In our minds, regular savings, bank financing, insurance policies and houses can be held for a long period of time, while index funds must be sold out quickly.
In fact, we just need to hold index funds with peace of mind, just like we have other assets that can generate cash flow.
Let's look at some data.
Hong Kong Stock Hang Seng Index started at 100 points in 1964, and in recent years it has increased to 60,000 points with dividends.
In addition, in Japan, South Korea, Britain, Germany, Australia and other countries, there are a fair amount of long-term profits generated from index funds, as long as the economic development can be sustained.
Index funds will fluctuate in the short term, but they will continue to deepen in the long term. Moreover, from the history of various countries, index funds can resist inflation and the decline of residents' purchasing power caused by excessive currency. As a major asset category, index funds are a very unsold choice.
However, if we pay too much attention to its rise and fall in the short term, it will be difficult for us to hold it for a long time. Because in the process of holding it, even if there is no change in the operation of the company behind it, the index fund will rise and fall due to various irrational panic and greed.Most of the time, we need to hold index funds to obtain the income from the operations of the related companies.
Keeping a positive attitude towards investment with a peace of mind is important for us to make long-term profits.
