Does the fund have a capital preservation type?
In the investment market, there is a kind of capital preservation fund, which is a low-risk investment method to guarantee the principal. Generally speaking, a capital preservation fund invests most of its assets in fixed-income bonds, so as to pay the investor's principal when the fund expires, and the remaining assets are about 15%-20% invested in stocks and other tools to improve the return potential.
Problems needing attention in capital preservation fund.
First, if the capital preservation time of the capital preservation fund is limited, generally speaking, the capital preservation period is generally 2-3 years;
Second, the capital preservation fund is redeemed halfway, and no capital preservation guarantee is provided;
Third, not all capital preservation funds provide 100% capital preservation.
Does the capital preservation fund have to be guaranteed?
Under normal circumstances, unless the issuer goes bankrupt and liquidates, it will affect the payment of principal and basically meet the safety of investors.
However, although the capital preservation fund can guarantee the basic principal, it does not guarantee the expected income. For investors, it is also a loss if they can only redeem the principal for a period of time without expected return.
In addition, some risks come from liquidity risk, issuers and market changes. This is because capital preservation funds do not apply for redemption at any time like ordinary open-end funds, and some fund managers and market changes are uncontrollable risks.
All the above opinions about capital preservation of capital preservation funds are for reference only, and I hope I can help you. Warm reminder, financial management is risky and investment needs to be cautious.