Money fund is an open-end fund, which invests in the money market, mainly investing in bonds, central bank bills, repurchase and other short-term wealth management products with high security; Bond funds are funds that invest in bonds, mainly treasury bonds, financial bonds and corporate bonds.
The income of the money fund is only higher than the interest rate of bank time deposits, but there is no interest tax. You can redeem it at any time, and generally you will receive the funds the next day after applying for redemption. Therefore, the money fund is very suitable for units and individuals who pursue low risk, high liquidity and stable income. These two products have their own advantages.
As the king of cash management, money fund has high security, high liquidity and stable income, which is similar to "quasi-savings" and always blooms the charm of investment. According to the data of Galaxy Securities Fund Research Center, as of July 29th, 20 14, the average annual income of 49 A-level money funds in 20 14 was 1.8354%. Among them, Harvest Money Market Fund, the fourth phase of Jinniu money fund, ranks in the forefront of money funds with a yield of 2.0639%, outperforming the average market income level. If converted into annualized rate of return, it also exceeds the current annual fixed income level of 3.5%.
Since July, some banks have unilaterally terminated the long-term wealth management products when they were established. In addition, the subscription and expiration time of wealth management products is usually long, which reduces the actual income level of investors, while the regulatory authorities have restricted the financing trust products, which will also reduce the investment scope of the original short-term wealth management products, thus reducing their income level.
Because the average term of assets allocated by the money fund is short, the assets of the fund can be accumulated in a very short time. Moreover, the funds due to be paid will soon be invested in short-term bonds, central bank bills, agreement deposits and other varieties with higher returns after raising interest rates, thus rapidly increasing the income of the money fund. Therefore, for investors, money funds are suitable for phased allocation, with low risk and good returns.