Investing in capital preservation fund is a less risky investment and financial management method. So, what does the capital preservation fund mean? I have compiled the following contents. Come and see what a capital preservation fund is!

What does capital preservation fund mean? It is understood that the capital preservation fund is a capital preservation fund that provides a certain proportion of investment principal in a certain period of time. Funds use interest or a very small proportion of assets to engage in high-risk investments, while most assets engage in fixed-income investments, so that no matter how the market for fund investment falls, it will not be lower than the guaranteed price, thus achieving the role of "guaranteeing capital".

Some people may ask, capital preservation fund and money fund are both funds with small risks and small returns, so what is the difference between them? Capital preservation fund and IMF mainly have the following differences:

1. The subscription and redemption fees are different: there is no subscription and redemption fee for money funds, while the subscription and redemption fee for capital preservation funds is higher, which increases the cost relatively.

2. The calculation method of income is different: the net value of the money fund remains unchanged, always maintaining 1 yuan, and there is income every day. 1 month 1 day, which not only increases the share, but also enjoys compound interest. The income of the capital preservation fund is reflected in the change of its net value. Sometimes the net value is less than 1 yuan, and only when it reaches 1 yuan and the redemption fee can the cost be realized can it be considered as a profit.

3. The holding time is different: the holding of money funds is convenient and will be profitable one day. Capital preservation funds have requirements for holding time, usually three years. If the net value is lower than the face value at the time of early redemption, the capital preservation cannot be realized.

4. Capital preservation fund refers to a fund that provides 100% or higher guarantee for the principal invested by investors within a certain investment period (such as 3 years or 5 years).

5. The Monetary Fund does not promise to protect the capital.