There is a misunderstanding that many people buy funds, that is, they buy them when they see high returns. But in fact, those high-yield funds are mostly high-risk funds. Although buying them has the opportunity to get high returns, it is also easy to lose money. Then, if you buy a fund and lose money, will it go up if you don't sell it? Is it possible to lose all the principal?

Can a fund that has fallen rise if it has been held all the time? To answer this question, we must first know why a fund will fall. There are two main reasons for the decline of the foundation. One is that the fund manager is not good, and the other is that the market is not good. If it is an active fund, it has something to do with both reasons. If it is a passive fund, it is basically only related to the market. The fund manager of a fund can't be much worse. Otherwise, which fund company dares to use him/her as a fund manager? How can he sell his own fund if a mediocre fund manager discredits him?

Therefore, even if the fund manager's ability is not good, when the market is good, there is a great probability that he can make money. But if the market is not good, the loss is almost certain. For these funds managed by fund managers, they mainly depend on the weather, including passive funds with low requirements on their ability. At this time, after the fund has fallen, whether it can continue to rise depends mainly on whether the market invested by the fund can follow up.

An excellent fund manager will almost certainly make money when the market is good, but he will lose money when the market is bad. Because even active fund managers can't choose short positions when the market is bad like retail investors, but must keep the lowest positions, so they can only passively bear the market decline. For these funds managed by fund managers, the decline is basically caused by market failure. However, whether the fund that fell can rise back is relatively less dependent on the improvement of the market.

Since most markets will only go down instead of up, no matter what the ability of fund managers is, most funds should have the opportunity to go up after falling. The difference is that some funds were just established at the high point of the market, and even if they rose later, they failed to return to the original high point. At this time, funds managed by excellent fund managers can rise back after falling, while funds managed by incompetent fund managers are more difficult to rise back after falling.

Of course, although most funds have been held after the decline, they can rise back, provided that the funds are not closed during this period, and once they are closed, there is no hope. Then, if a fund is closed, or has been falling without closing, will it lose all its principal?

Will the fund lose all its principal if it keeps falling? Theoretically, if the fund keeps falling, it is possible to lose all the principal, but it is actually impossible. First of all, the liquidation of the fund is not to liquidate the net value of the fund, but to return the remaining assets of the fund to investors. Because when the size of a fund or the number of holders is less than a certain number, it will trigger the liquidation conditions, and it is not necessary for the fund net value to fall to zero before liquidation.

Secondly, even if the fund does not liquidate and continues to fall, the net value will not fall to zero, because it is almost impossible to make all the assets invested by the fund become zero. Therefore, even if the fund loses money again, it is impossible to lose the principal.