As investors, we most want to invest in products with higher returns, less risk, and stronger liquidity. But will there be such a product?

one。 Impossible triangle

There is a concept in economics called"impossible triangle"It means that it is impossible for a country to achieve free capital flow, the independence of monetary policy and the stability of exchange rate at the same time.

In other words, if a country wants to allow capital flows and requires independent monetary policy, it is difficult to maintain exchange rate stability; if exchange rate stability and capital flows are required, independent monetary policy must be abandoned.

The phenomenon of "impossible triangle" is common in many economic fields. In the business world, high gross margin, low cost and high turnover are also a group of impossible triangles. Any business model can only pursue two of them at most and abandon the third. By analogy, when examining the characteristics of any financial product, it also has the principle of "impossible triangle".

That is,High returns, low risk and high liquidity will not exist at the same time..

two。 Three elements of investment

Risk, return and liquidity are the three key elements that need to be measured in any kind of investment. But these three can not exist at the same time, when making investment, we need to make a choice among the three.

In particular, liquidity here refers to the ability of an asset to cash quickly at market price. Generally speaking, liquid assets enjoy a liquidity premium. This is why the price of a company's shares before going public is significantly lower than the price of shares traded on the open market, which includes a liquidity premium.

1. If the pursuit of low risk, high liquidity, then Yu'e Bao, money funds, treasury bonds and other current financial management is the best choice. These products meet the safety and liquidity of assets can not meet the profitability, the rate of return is difficult to be higher than 4%.

2. If you want to increase returns and the risk is lower, you have no choice but to sacrifice liquidity. For example, from current financial management to regular financial management or even real estate investment, for example, the rate of return of one-year financial products can reach more than 5%. Or index fund investment, if the holding time is short, the risk is very big. But if the holding time is longer, the longer the time is, the less the risk is, and the greater the expected return will be. Assets that meet profitability and safety often fail to meet liquidity

3. If you want high returns and high liquidity, you have no choice but to sacrifice risk. Similar investment methods such as futures, leverage, stocks, and even lottery tickets can be regarded as three high-risk, high-return and high-liquidity varieties. The most typical is partial P2P. Before the explosion, liquidity and profitability are relatively good, so it has attracted a large number of ordinary people's funds to enter. However, it can not meet the security, in the event of a crisis, it is fatal, the risk of system collapse. Assets that satisfy profitability and liquidity often fail to meet security.

Any investment is a choice among the three elements of return, risk and liquidity. The same product, suitable for others, may not be suitable for you, because the risk tolerance or liquidity requirements are different, so how do we choose?

three。 The choice of three elements

For investment, risk is always the first consideration. Because the money can not be earned, but it can be lost, the first thing is to ensure the safety of the principal.

Considering risk first does not mean buying only low-risk products, because most of the time the risk is always matched with the return. As long as the investment risk does not exceed its own risk bearing capacity, it can properly take the risk in order to pursue a higher rate of return.

If you want to use money at any time, you can only invest in highly liquid varieties. Only restricted funds that have not been used for a long time for 3-5 years can be used to invest or buy funds. No matter what kind of investment, you should consider your own risk tolerance, set aside appropriate emergency funds, and don't take chances.

For example, I have to buy a house for a down payment next year. Seeing that the market is good recently, I want to buy a fund first and sell it when I make money. As a result, it has been falling all the way in the short term, and when the money is needed, the fund is still losing money, and the bad plan can only be blamed for cutting the meat out.

We all want to make more money, but the rate of return is always the last consideration in investment. First of all, the investment risk should be able to bear, secondly, the investment period should be matched, and finally, the investment with high return should be chosen from different investment varieties.

four。 You can't have both fish and bear's paw.

You can't have both a fish and a bear's paw. If someone says that his investment products have high returns, strong liquidity and security, and take into account all three aspects, he must be mediocre. Everyone's situation is different, so there is never a universal financial management model and method.

In investment and financial management, everyone needs to learn whether an investment can be invested, others can make suggestions, but whether it is suitable to invest, only after weighing their own situation, can they make a judgment.