Capital preservation fund is a low-risk investment fund, which generally has a specific investment period and provides "guaranteed income" and "additional potential income".

"Guaranteed income" includes the principal guarantee on the maturity date, and some funds also provide regular guaranteed dividends, both of which are agreed in advance to give investors a certain budget. The principal guarantee and guaranteed dividend are guaranteed by the guarantor, whose qualification must be recognized by the China Securities Regulatory Commission, usually a licensed bank or insurance company in Hong Kong.

As for the "additional potential return", it mainly depends on the investment performance of the fund, and it is not stipulated in advance. The investment items of the fund can be market index, stocks, funds, foreign exchange and interest rates, depending on different capital preservation funds. The "additional potential return" can be distributed in the form of dividends in a specific period before the maturity date, or it can be provided on the maturity date.

Capital preservation fund return = maturity gold guarantee+guaranteed dividend (if any)+additional potential return.

What are the benefits of investing in capital preservation funds?

The reason why the capital preservation fund can attract investors is that the objective investment environment is favorable and the fund itself has many unique advantages. Generally speaking, investing in capital preservation funds can enjoy the following benefits:

1. Enjoy a certain degree of principal guarantee.

Investment often has gains and losses, even professional investors sometimes have losses. The capital preservation fund not only provides investors with investment opportunities, but also guarantees a certain degree of principal protection on the maturity date, and even provides guaranteed dividends. As for the degree of capital preservation or the amount of capital preservation dividends, it depends on different capital preservation funds.

2. Have the opportunity to participate in market growth.

Because most capital preservation funds are linked to specific investment projects, such as market index, a basket of stocks or a basket of funds, investors who subscribe for capital preservation funds not only enjoy the principal protection at maturity, but also have the opportunity to share the potential benefits brought by linked projects and strive for additional potential returns.

3. Budget for downside risks.

Because investors can get a certain degree of principal protection by holding the capital preservation fund until the maturity date, and even enjoy the capital preservation dividend, they have a certain budget for downside risks. For example, if an investor subscribes for a capital preservation fund, the capital preservation fund will preserve 90% of the capital. Excluding the opportunity cost paid during the investment period, the risk he needs to face is the loss of 10% of the principal.

4. It helps to diversify the risks in the portfolio.

Although any investment product involves risks, the degree is different. Among different types of funds, the risk degree of capital preservation fund is lower than that of most other fund types. If investors can join the capital preservation fund in the portfolio, it will undoubtedly help to spread the risks in the portfolio.

What are the main risks involved in investing in capital preservation funds?

If the investment period is the same, compared with other fund types, the capital preservation fund involves lower risks (see the figure below).

The risks involved in holding the capital preservation fund until the maturity date or redeeming it before the maturity date are not the same, which are roughly listed as follows:

Hold to maturity date

Market risk: Capital preservation funds strive for additional potential returns by investing in different portfolios. However, if the market performance is not satisfactory, investors may only get back the principal guarantee in the end, without additional potential returns.

Counterparty credit risk: the capital preservation fund provides guaranteed income and additional potential income through fixed interest and other investment tools respectively. Once the counterparty involved in the investment has credit problems, such as bankruptcy or financial problems, the guaranteed income and additional potential income of the fund will be damaged. However, since the guaranteed income is borne by the guarantor, the risk can be passed on to the guarantor.

Guarantor's credit risk: As long as investors hold the capital preservation fund until the maturity date, they can enjoy the principal guarantee, and some capital preservation funds will also guarantee dividends during the investment period. However, since both the principal guarantee and the guaranteed dividend are guaranteed by the guarantor, once the guarantor has any financial problems, the investor may not get the guaranteed return.

Liquidity risk of funds: Because the capital preservation fund has a specific investment term, investors need to hold the fund until the maturity date to enjoy the principal protection, so their available liquidity will be reduced accordingly. Therefore, before making an investment decision, investors should consider whether the funds used need emergency use.

Redemption before maturity date

Market and liquidity risk: since the principal guarantee is not applicable to the fund units redeemed before the maturity date, investors can only get back the investment amount according to the net asset value of the fund units at that time, and the relevant net asset value is calculated based on the market price of all investments held by the fund. If the relevant investment fails, investors will have to bear the losses. In addition, because the capital preservation fund holds a large number of fixed interest rate instruments, such as redeeming units before maturity, asset prices will be affected by interest rate changes, so the interest rate risk is the most obvious. In addition, because the fund needs to sell some assets to meet the redemption requirements, if the liquidity of related assets is insufficient, it may also have a negative impact on the fund price.

Counterparty credit risk: Capital preservation funds provide guaranteed returns and additional potential returns through fixed interest and other tools. Once the counterparty involved in investment has credit problems, such as bankruptcy or financial problems, the redemption price will be affected.

Redemption fee payment risk: Some fund companies charge redemption fees to investors who redeem their units in advance. If investors redeem their units before the maturity date, they may have to pay the relevant redemption fees.

Investment cost risk: Since most expenses of the capital preservation fund, including management fees, trust fees, guarantee fees, fund establishment fees, etc., have been paid at the initial stage of fund operation, investors must bear all expenses related to the fund during the whole investment period regardless of whether they redeem the fund shares before the maturity date.

The above are the main risks involved for investors to hold the fund until the maturity date and redeem it before the maturity date. However, regardless of whether the unit is redeemed on or before the maturity date, investors must bear the following risks:

Exchange rate risk: If the capital preservation fund invested by investors is quoted in a foreign currency other than US dollars, and the redemption amount or dividend needs to be converted into US dollars or Hong Kong dollars, they must bear the exchange rate risk.

Fund manager manages risk: it is suitable for capital preservation funds that strive for additional potential returns by actively managing their portfolios. If the fund manager does not manage the assets well, the extra potential return will be damaged, and investors may only get back the principal guarantee in the end.

Who is suitable to invest in the capital preservation fund?

Because the capital preservation fund provides guaranteed income and additional potential income, it is especially suitable for the following people as investment choices:

Medium and long-term investors

Expect to lock in a certain degree of guaranteed income

Expect to participate in the investment market with low risk and strive for additional potential returns.

For those who have stable investment orientation or expect diversified investment, refer to: hangseng/h * * */chi/ref/sic/gua/FAQ/FAQ1# FAQ1a. Generally speaking, capital preservation funds invest most of their assets in fixed-income bond projects, so as to pay the investors' principal when the fund term expires. The remaining assets will be invested in tools such as stocks to improve the return potential. The fund company will ensure that investors get a certain proportion of investment principal after the fund expires, such as 100% principal.

If the ups and downs of the stock market will make your heart beat faster, then the capital preservation fund may make you sleep more at ease. However, if the investor withdraws before the fund expires, the investor will not be able to break even.

. Morningstar /HKG/ articles/feature articles? ArticleId =/ODS/2000/FAFI/2000 fafi 24 e _ 2006 54 38+002 16。 XML & ampChange _ needed = CH, reference: I hope I can help you. If the capital preservation fund has no money to earn, it can get its principal back at maturity. As for other questions, you can check with the bank. However, if you put the money for a few years, you can only get back the principal. It is better to put it on a regular basis, at least with interest. ,