Not all funds calculate compound interest, only fund fixed investment does. Fund fixed investment itself does not have compound interest, but when the fixed investment fund distributes income and chooses the method of reinvesting dividends, it will There will be compound interest.
The amount of the principal of each period is different when calculating the compound interest of fixed investment of the fund. It is mainly used to calculate the final value of principal and interest of multiple equal investments and to calculate the return value of multiple equal amounts. Compound interest is further divided into intermittent compound interest and continuous compound interest. The method of calculating compound interest on an annual, half-year, quarterly and monthly basis is intermittent compound interest, and the method of calculating compound interest on an instantaneous basis is continuous compound interest.
Fund fixed investment is the abbreviation of regular fixed-amount investment fund. It refers to a method of investing a fixed amount at a fixed time into a designated open-end fund, which is similar to the bank's small deposit and lump sum withdrawal method.
Compound interest means that after each interest accrual period, the interest generated and the principal are included in the next period's interest in the form of cost. Compound interest is profit-making, which is commonly known as compound interest.
Extended information:
Fund, English is fund, which broadly refers to a certain amount of funds established for a certain purpose. It mainly includes trust investment funds, provident funds, insurance funds, retirement funds, and various foundation funds.
From an accounting perspective, funds are a narrow concept, meaning funds with specific purposes and uses. The funds we mention mainly refer to securities investment funds.
According to different standards, securities investment funds can be divided into different types:
(1) According to whether fund units can be added or redeemed, they can be divided into open-end funds and closed-end funds. type fund. Open-end funds are not listed for trading (it depends on the situation). They are purchased and redeemed through banks, securities firms, and fund companies. The fund size is not fixed; closed-end funds have a fixed duration and are generally listed and traded on securities exchanges. Investors pass Fund units are bought and sold in the secondary market.
(2) According to different organizational forms, they can be divided into corporate funds and contract funds. A fund is established by issuing fund shares to establish an investment fund company, which is usually called a corporate fund; it is established by a fund manager, a fund custodian and an investor through a fund contract, which is usually called a contract fund. my country's securities investment funds are all contract funds.
(3) According to different investment risks and returns, they can be divided into growth, income and balanced funds.
(4) According to different investment objects, it can be divided into stock funds, bond funds, money market funds, futures funds, etc.
It is not certain which was the earliest hedge fund. During the great bull market in the United States in the 1920s, there were countless such investment tools specifically for the wealthy. The most famous of these is the Graham-Newman Partnership fund founded by Benjamin Graham and Jerry Newman.
In 2006, Warren Buffett claimed in a letter to the Museum of American Finance magazine that the Graham-Newman Fund in the 1920s was the earliest hedge fund he knew of. But other funds are likely to emerge sooner.
During the economic recession of 1969-1970 and the stock market crash of 1973-1974, many early funds suffered heavy losses and closed down one after another. In the 1970s, hedge funds generally specialized in one strategy, with most fund managers adopting a long/short stock model. During the recession of the 1970s, hedge funds were largely ignored until the media reported on several highly successful funds in the late 1980s.
The bull market of the 1990s created a new class of wealthy people, and hedge funds blossomed everywhere. Traders and investors pay more attention to hedge funds because of their emphasis on interest-aligned income distribution models and "outperforming the market" investment methods. In the next ten years, hedge fund investment strategies have emerged in an endless stream, including credit arbitrage, junk bonds, fixed income securities, quantitative investment, multi-strategy investment, etc.
In the first decade of the 21st century, hedge funds once again became popular around the world. In 2008, the total assets held by global hedge funds reached US$1.93 trillion. However, the credit crisis in 2008 severely damaged hedge funds and their values ??shrank. Coupled with the obstruction of liquidity in some markets, many hedge funds began to restrict investor redemptions.