1. Is the Pure Debt Foundation losing money?
Pure debt fund is a fund that specializes in investing in bonds. Bonds are issued by enterprises and countries, and they all have a characteristic: they have a certain term, and the principal and interest are returned at maturity, and the interest is higher than that of bank deposits. Therefore, the risk of buying a pure debt fund is not great, and its biggest risk is that it cannot keep up with the pace of inflation.
Theoretically, pure debt funds do not participate in investing in new shares, convertible bonds and stocks, but only pay attention to national debt and high-grade corporate credit bonds, so the margin of safety is very high. Although the expected annualized expected return is low, the probability of principal loss is extremely low! However, in theory, after all, it is only in theory. If there is a global economic crisis or the central bank is forced by monetary pressure to significantly increase the expected annualized interest rate of deposits (raising interest rates several times), then pure debt funds will also suffer principal losses, but the losses are relatively small!
Second, how to choose a pure debt fund?
1, the fund size should not be too large.
The scale of bond funds still has an impact on the performance of bond funds. One disadvantage of bonds is that they are not actively traded. Many times, trading is a difficult problem. If it is too big, it will miss the opportunity.
2. The proportion of institutions among the holders should be high.
The higher this is, the better, unless it is a mini-fund, the scale is less than 1 100 million, which is to help the fund support. Because the research ability of institutions on bonds is not comparable to that of retail investors, the high probability they recognize is not wrong.
3. The overall strength of the company is stronger.
What is said here is that the company has an excellent bond investment team, not a big company. The company has a complete and powerful investment research and trading team, which is a strong guarantee for fund performance. Fund companies with good past performance are preferred.
4. The redemption rate should be as low as possible.
It's best not to, but not too high, because bond funds can't make much, and if they don't count here, they can't make much.
5. The fluctuation of net value should be small, and the retracement should be small.
The smaller the risk of pure debt fund, the smaller the fluctuation of net value, so don't just pay attention to the expected annualized expected return and ignore the fluctuation of fund, which is contrary to your original intention of choosing pure debt fund.