What does absolute income fund mean?
Refers to the fund that pursues absolute returns. Most funds in the fund market pursue relative returns, that is, the fund aims to outperform the market. Absolute income fund pursues absolute income, which has nothing to do with the overall performance of the market. Regardless of whether the market is a bull market or a bear market, the absolute return fund sets a target of 5%, and when it reaches it, it completes its task.
Absolute return funds pursue positive returns by adopting investment management skills different from traditional funds. The income earned by absolute income fund is the difference between stock and option, which has nothing to do with market fluctuation.
Absolute return investment technology usually includes short selling, futures, options, derivatives, arbitrage, leverage and other non-traditional assets. This requires shorting options or futures while buying stocks. When the market goes up, do more stocks to make money and short options to lose money. When the market falls, stock bulls lose money and short options make money.
Absolute income funds can be roughly divided into four categories: fixed income, secondary debt base, flexible allocation funds and quantitative hedge funds. The layout of absolute return funds needs to focus on sharp ratio and maximum retracement. The higher the sharp ratio, the better, and the lower the maximum withdrawal.
After reading the above introduction, I believe everyone has a better understanding of absolute income funds. Finally, I would like to remind you that absolute income funds are not necessarily funds with positive returns. Absolute income funds are not necessarily funds that invest in fixed income. It's just a fund that pursues absolute returns.