What are the channels for compound interest investment?

Corresponding to compound interest investment is simple interest investment, that is, after a single investment, part of the expected income is obtained within a certain period of time, which is the most common lending behavior. Compound interest investment is a friend of time, and the expected return will be greater with the passage of time. What are the channels for compound interest investment? We will explain four channels of compound interest investment for you.

1, the concept of compound interest investment

Compound interest investment means that after the end of one investment cycle, the principal and expected income of the investment will jointly generate expected income in the next investment cycle, and then circulate in turn. The longer the cycle, the higher the expected return.

2. Compound interest investment channels

(1) Stock investment

In the process of stock investment, when a transaction ends, the expected income generated by the transaction, such as dividends and capital gains, can be invested in the next investment together with the invested principal, so that the investment has compound interest value.

(2) Fixed investment of the fund

This is one of the most common channels for compound interest investment. The advantage of the fixed investment of the fund is to buy the same fund variety and invest for a long time, with small amount and high frequency. It can effectively spread the cost of holding positions and benefit from investment, which is one of the best ways of compound interest investment.

(3) Index funds

Index funds are actually simulating and tracking indexes. Funds that buy a basket of stocks generally set the fund as expected income for investment, that is, when the stocks in the fund produce dividends, the dividends from investment are directly purchased by the fund. With the passage of time, dividends and principal can produce higher investment value.

(4) Fixed expected return investment

In fact, fixed expected return investments, such as bank wealth management and money funds, are also compound interest investment channels. When a certain bank financing expires, you can buy new products together with the expected income generated by the investment, resulting in the value of compound interest.

The above four kinds of wealth management products, that is, the common channels of compound interest investment, should be selected according to the actual needs of investors. Tips: Financial management is risky, and investment needs to be cautious.