The investment operation of hierarchical bond funds is no different from that of ordinary bond funds. The difference is that hierarchical bond funds divide the equity and allocate it to sub-funds according to a certain strategy.

There are two categories: A and B. The Class A shares of graded bond funds are low-risk shares, similar to fixed income products; the Class B shares of graded bond funds have higher risks due to the use of leverage, but at the same time, they may also obtain higher returns.

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Judging from the performance level this year, the performance of the high-risk B shares of graded bond funds is much better than that of general bond funds.

1. The first thing that needs to be explained is that no matter how it is graded, all gains or losses come from the parent fund, and the fund company will not bear losses due to the grade.

When the market rises, the excess returns generated by the highly leveraged part are generated from the contribution of A's share; when the market falls, A's fixed income comes from the excess losses of B's ??share.

2. Secondly, for B share with high leverage, the lower the net worth, the higher the leverage, which means the greater the risk; the higher the net worth, the lower the leverage.

The reason is also very simple. In fact, the high leverage comes from the borrowing of funds from share A.

The lower the net worth, the higher the proportion of borrowed parts and the greater the leverage.