Bond funds are also a type of fund. Among various types of funds, bond funds are also a relatively low-risk fund type.

Bond funds refer to funds whose investment targets are bonds.

So is it possible for a bond fund to lose money? Let’s find out together.

Do bond funds lose money? Bond funds lose money.

Because bond funds mainly invest in bonds, they have the risk characteristics of bonds.

If the bonds invested by a bond fund are breached, the net value of the fund will fall significantly, and the rise and fall will most likely exceed that of stock funds.

The accumulated income of the fund will be seriously reduced, or even the accumulated income will be lost.

Bond funds are also subject to fluctuations in bond values ??due to changes in interest rates during the bond ownership period. If the operation is unreasonable, losses will also occur, so bond funds will cause investors to lose money.

However, the main factor affecting bond returns is inflation. If there is significant inflation in the market, bank deposit and loan interest rates will often rise.

At such a time, investors will abandon bond investment and switch to other investments, and financial institutions will allocate bond cash funds to other markets, causing bond prices to fall.

In fact, the risks of bond funds mainly come from two aspects, specifically as follows: 1. Interest rate risk: If currency tightens, interest rates continue to rise, and deposit interest rates increase, the bond sales market will be suppressed to a certain extent, which will affect the bond market.

Fund market information; 2. Credit risk: that is, if the bond issuer breaks the contract and cannot honor the bond's interest rate, the fund will also lose money.

The impact of interest rate cuts on bond funds: Interest rate cuts are beneficial to bond funds.

When bank interest rates lower and interest rates decrease, many assets will flow out of savings deposits, and bond prices will rise, which will be beneficial to bond funds.

At the same time, the central bank's interest rate cut is conducive to the stable development of the bond market, conducive to the increase in the net value of bond funds, and is very beneficial to stabilizing investors' investment returns.