With the progress of society, people are no longer satisfied with putting money in the bank, but are more interested in buying wealth management funds to increase their value. For beginners, you need to know more. So, what about the money fund? Let me tell you something.

What about the money fund? Money market funds refer to funds that invest in short-term securities in the money market. The assets of the fund are mainly invested in short-term monetary instruments. Money market funds have the following characteristics:

1, principal security Because most money market funds mainly invest in low-risk securities such as treasury bonds, financial bonds, central bank bills, bond repurchases, interbank deposits, etc. with a remaining maturity of less than one year, these investment types determine that the risk of money market funds is the lowest among all types of funds, and in fact, the principal security is guaranteed.

2. Strong capital flows

Liquidity is comparable to demand deposits. The fund is easy to buy and sell, with short time to receive funds and high liquidity. Generally, the funds will arrive in two or three days after redemption.

3. Higher yield Most money market funds generally have the income level of national debt investment. Money market funds can not only invest in investment tools that ordinary institutions can invest in, such as exchange repurchase, but also enter the inter-bank bond and repurchase market and the central bank bill market for investment. Its annual net rate of return can generally reach 23, and its recent rate of return reaches 2.6% and 2.7%, which is much higher than the income level of bank savings in the same period.

4. The investment cost is low. Money market funds are generally free of handling fees, and the subscription fee, subscription fee and redemption fee are all zero. It is very convenient for funds to go in and out, which not only reduces the investment cost, but also ensures the liquidity.

Dividends are tax-free. Most money market funds always maintain the face value of 1 yuan. The income is calculated every day, and there is interest income every day. Investors enjoy compound interest, while bank deposits are only simple interest. Monthly dividends are carried forward as fund shares, and dividends are exempt from income tax.