In the process of fund trading, besides the fund subscription, subscription and redemption that we often operate, there is also fund conversion. In fact, there are not many people who use the function of fund conversion, but under appropriate circumstances, making good use of fund conversion can help us make better fund investment.

Advantages of fund conversion

Fund conversion can save transaction costs, and fund conversion can combine fund redemption and fund subscription into one to achieve seamless connection.

If you hold a fund of a fund company, you can directly convert the previously held fund into another fund of the fund company through the fund conversion function, without redeeming it before purchasing it.

It can not only effectively save transaction time, but also save transaction cost.

Using fund conversion to control investment risk

Converting other types of funds into money funds is a very good hedge. The common conversion is that partial stock funds are converted into money funds and bond funds are converted into money funds.

For example, you used to hold stock funds or partial stock hybrid funds. At this time, the stock market is facing greater risks or the fund you hold has risen sharply. At this time, the funds you can control can be converted into money funds to temporarily avoid risks in the market.

Because money funds are very stable varieties, the income gap between different money funds will not be great, and basically you can find the right variety of money funds in the same fund company, so that you can make full use of the function of fund conversion.

The money fund itself has no subscription fee, so it will basically not save transaction costs, but it can save transaction time.

Adjust asset allocation through fund conversion

We can make full use of the seesaw effect of the stock and bond markets through fund conversion, and it is the most common fund conversion to convert in stock or partial stock mixed and bond funds.

In most cases, there is a seesaw effect in the stock market and bond market. The best way to seize this opportunity is to switch between stock funds and bond funds in a timely manner.

When the economy is booming and the market interest rate is falling, we can convert bond funds into stock funds and share the dividends that drive the stock market to rise.

When the economy is bad and interest rates fall, we can convert stock funds into bond funds to temporarily avoid the risks in the stock market and share the dividends in the bond market.

Of course, sometimes the stock market and the bond market will fall at the same time, such as 20 1 1, local government debt crisis, soaring interest rates, credit bond prices plummeting, the economy is also greatly affected, and the stock market has also fallen sharply.

Generally speaking, the subscription fee of partial stock funds is slightly higher than that of bond funds. When a partial stock fund is converted into a bond fund, it is generally not necessary to pay the difference between subscription fees and redemption fees. The redemption rate of holding 1 year to 2 or 3 years is generally 0.25%, and the expense rate is not high.