Bond fund is a fund product with low yield and low risk. The annual income of bond funds is generally slightly higher than the bank interest rate in the same period, generally around 5%. The average annual yield of pure bond funds is slightly higher than that of 1 year bonds, and the average annual yield of bond funds is 10%. Based on 2.79% bank interest. The fluctuation range is 200%-50%, about 9%-4%. In addition, the annual management fee of the fund is 1.5%. The actual income is 7.5%-2.5%. Average median, 5%.

There are two factors that affect the performance of bond funds, one is interest rate risk, that is, the sensitivity (also called duration) of investing in bond interest rate changes, and the other is credit risk. Credit Risk When choosing a bond fund, we must understand its interest rate sensitivity and credit quality. On this basis, we can know how high the risk of the fund is and whether it meets your investment needs.

The rise and fall of bond prices is inversely proportional to the rise of interest rates. When interest rates rise, bond prices fall. Only by knowing the change of bond price can we know the sensitivity of bond fund net value to interest rate change and how to measure it continuously.

The maturity of bonds depends on three factors: payment of principal and interest, cash flow and yield to maturity. The term is several years, but with the maturity of bonds, this is a different concept. Through this indicator, we can see how much the fund company has gained and lost in the result of interest rate changes.

Extended data:

Funds that mainly invest in fixed-income financial instruments such as treasury bonds and financial bonds are called bond funds. Because the products they invest in have relatively stable returns, they are also called "fixed-income funds". According to the proportion of investment in stocks, bond funds can be divided into pure bond funds and partial debt funds.

The characteristics of bond funds:

1. Low risk, low income

Because the investment object of bond funds-bonds have stable returns and low risks, bond funds have low risks, but at the same time, because bonds are fixed-income products, bond funds have low risks but low returns compared with stock funds.

2. Low cost

Because bond investment management is not as complicated as stock investment management, the management fee of bond funds is relatively low.

3. Stable income

Investment bonds have regular interest returns and promise to repay the principal and interest at maturity, so the income of bond funds is relatively stable.

4. Pay attention to current income

Bond funds mainly pursue relatively fixed income in the current period, and lack appreciation potential compared with equity funds, so they are more suitable for investors who are unwilling to take too many risks and seek stable income in the current period.

References:

Baidu encyclopedia-bond fund