What are the characteristics of bond funds? What are the characteristics of debt base?
1. Low risk, low expected annualized expected return
Debt base, as the name implies, is the largest proportion of bonds in asset allocation. Bonds are stable investments with low risks and low returns. Of course, so is the debt base. Because the bond fund's investment object-the expected annualized expected return of the bond is stable and the risk is small, the risk of the bond fund is small, but at the same time, because the bond is a product with fixed expected annualized expected return, the risk of the bond fund is lower than that of the stock fund but the yield is not high.
2. Low management cost
Investment funds have many kinds of expenses, which are extremely cumbersome. Debt-based funds do not need to invest in stocks to allocate funds, so investing in stocks does not require a lot of management fees, so the management fees of bond funds are relatively low.
3. Expected annualized expected return is stable.
Bonds are known as a sound investment method, so the expected annualized expected return of bond funds is also very stable. Investment bonds have regular interest returns and promise to repay the principal and interest at maturity.
4. Pay attention to the current expected annualized expected return.
Bond funds mainly pursue relatively fixed returns 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 and expected annualized returns in the current period.
Advantages and disadvantages of bond funds:
Debt-based is indeed a good place for conservative investors, but just because the risk of debt-based is low, it cannot be considered that it has no shortcomings. Its main disadvantage is that its income is also low. Many financial investors hope to obtain high expected annualized expected returns through financial management. However, investing in debt base can not bring high expected annualized expected returns.
superiority
1. Low-risk bond funds can effectively reduce the risks that a single investor may face when directly investing in a bond by pooling investors' funds to make portfolio investments in different bonds.
2. Financial Management With the increasing diversification of bond types, ordinary investors should not only carefully study the issuer, but also judge the macroeconomic indicators such as the expected annualized interest rate trend, which is often beyond their ability, while investing in bond funds can share the fruits of their operation.
3. If investors with strong liquidity invest in bonds with poor liquidity. Only when it is due can it be cashed, and indirectly investing in bonds through bond funds can obtain higher liquidity and can transfer or redeem the bond funds held at any time.
disadvantaged
1. The expected annualized expected return is low, and only by holding it for a long time can a relatively satisfactory expected annualized expected return be obtained.
2. When the stock market skyrocketed, the expected annualized expected return remained stable at the average level. Compared with equity funds, the expected annualized expected return is lower, and there is even the risk of loss when the bond market fluctuates.