Secondly, the investment scope of short-term debt funds and medium-and long-term pure debt funds is limited to bonds, and convertible bonds are not invested (except for the pure debt part of convertible bonds that can be traded separately). The main difference between the two is that the duration of the bonds invested is different.
The remaining maturity of bonds invested by short-term debt funds is generally within 1 year, and Huian short-term bonds are such bond fund products; The medium and long-term debt-based investment bonds have no time limit, and they can invest in both short-term bonds and long-term bonds. Generally, it mainly invests in medium-and long-term bonds with a maturity of 1 year or more, and Huian Yutong pure debt fund is a long-term bond.
Note: The "remaining maturity of bonds" mentioned here is often called "duration", which refers to how long it takes for bonds to repay principal and interest. Generally speaking, the shorter the duration, the closer the time to repay the principal and interest, the smaller the fluctuation of the bond, the smaller the risk and the higher the certainty of the income. Take Huian short-term bonds as an example. According to the announcement, it will not participate in stock market investment, convertible bonds and exchangeable bonds.
Because it is far away from the stock market and has a short duration, short-term debt funds generally belong to low-risk funds. Compared with medium and long-term pure debt funds, it is less affected by market interest rates, with lower risk and less fluctuation. According to the regular report of the Fund, short-term and medium-term debt bonds of Hui 'an achieved positive returns for four consecutive natural years from 2020 to 2023.
In addition, the subscription/redemption method of short-term and medium-term debt funds is relatively flexible. Most short-term and medium-term debt funds in the market can be purchased and redeemed every trading day, and they can be held for 7 days, 30 days or a certain period, and there is no redemption fee. Take the short-term and medium-term debt of Hui 'an as an example, it can be redeemed every trading day, and the confirmation date of buying and selling is T+ 1, which is earlier than the redemption date of ordinary bond funds on T+2 1 day, which meets the demand of capital flow.
Risk warning: fund investment is risky, so be cautious when entering the market.