Four risks of index funds: 1. Managing risk: Although index funds are passive funds, the investment target of the fund is still decided by the fund manager. If the fund manager's investment level is low, it will affect the fund's income. 2. Market risk: index funds invest in a basket of stocks, and the rise and fall of funds fluctuate with the rise and fall of stocks, while the stock market will rise or fall with the changes of listed companies' operating conditions and fund trading instructions, thus affecting the rise and fall of funds.

3. Liquidity risk: Liquidity refers to the ability to realize cash. The liquidity risk of OTC index funds is relatively small, while the liquidity risk of OTC funds is relatively large. If the funds cannot be sold in time, there will be liquidity risk.

4. Risk of fund redemption: For investors, although there are many categories of index funds, they all fluctuate with market conditions. In the whole financial market, once the real economy fluctuates, many people will redeem the fund, so there is a certain risk of fund redemption. In the whole process of financial management, if you want to quit early and need to sell at a low level, then you will have certain losses.

As the name implies, index fund is a fund product that takes a specific index as the target index, takes the constituent stocks of the index as the investment object, builds a portfolio by buying all or part of the constituent stocks of the index, and tracks the performance of the target index.