The difference between convertible bond funds and hybrid funds;
1, different investment objects.
Convertible bond fund is also a kind of bond fund, and its main investment target is convertible bonds. Convertible bonds not only have the characteristics of repayment of principal and interest due to ordinary bonds, but also have the characteristics that ordinary funds do not have, that is, they can convert bonds into stocks during the conversion period, which has the dual nature of stocks and bonds and is relatively risky.
Hybrid funds are mutual funds with fixed expected annualized expected returns, such as growth stocks, stocks and bonds with expected annualized expected returns. The purpose of hybrid fund design is to let investors diversify their investments by choosing a fund type, without buying different styles of stock funds, bond funds and money market funds.
2. Different investment risks.
Convertible bond funds usually use the bond characteristics of convertible bonds to avoid systemic risks and individual stock risks, pursue the security and stability of the portfolio and expect annualized expected returns, and use embedded stock options of convertible bonds to further improve the expected annualized expected returns of the fund in the stock market rise.
Hybrid funds adopt both aggressive and conservative investment strategies, with lower returns and risks than stock funds, but higher than bonds and money market funds. They are a kind of wealth management products with moderate risks, and some well-run hybrid funds even exceed the level of equity funds.
3. Different investment advantages
Because the convertible bonds of strong bonds have certain advantages over the national bonds and corporate bonds of the same term; Second, the increase of market uncertainty increases the option value of convertible bonds.
In a bull market, stock funds and index funds usually perform well, but if the market falls, index funds and stock funds will fall sharply because most of the assets held by these two funds are stocks. At this point, the advantages of hybrid funds appear.