Many people wonder why a fund that is a capital-guaranteed fund still loses money. In fact, it is normal for a capital-guaranteed fund to lose money. A fund that is called capital-guaranteed does not necessarily guarantee capital.

So does a capital guaranteed fund maintain its capital?

Let me tell you.

So does a capital guaranteed fund maintain its capital?

Having said the principles of capital preservation funds, let’s take a look at what conditions must be met to preserve capital: 1. It must be a subscribed fund.

Subscription means buying a new fund when it is first released.

Instead of waiting for the fund to come out and then buying it after a period of time, buying later is called subscribing to the fund.

The fund you subscribe to is one of the prerequisites for capital preservation (of course there are funds that also protect capital for subscription, but there are very few such funds and can be ignored directly. Most capital preservation funds only protect capital for the funds you subscribe to).

2. Must be held for a specified period of time.

Generally speaking, fund companies will agree on a three-year period.

There are also funds that stipulate 2 years, or other times. This depends on the terms when the fund is issued.

In other words, the capital preservation fund must be held for a specified period of time to preserve capital.

Sorry if you quit midway!

No guarantee of capital!

So does a capital guaranteed fund maintain its capital?

In fact, this is true not just for funds, but for all financial products.

We must read the information about the product clearly and know what it is like. Just because its name is a capital-guaranteed fund, we cannot assume that the fund is capital-guaranteed under any circumstances.