It is almost impossible for the fund to lose its principal. The worst case of the fund is liquidation, and the liquidated fund will eventually return the remaining funds to investors according to the fund share. The possibility of fund loss is the risk of the fund, and the risk should always be the first consideration. The fund that matches its own risk tolerance is the most suitable fund. How to judge the risk of the fund?

The name of the fund basically covers the general situation of the fund. For example, if the name of the fund contains the words mixed or stock, the fund is likely to be a mixed fund stock fund. The risk coefficient of such funds is relatively high.

Generally, those with the words "SSE 50" and "CSI 300" belong to index funds, and the risk coefficient is relatively low.

Some fund names include "stability", "appreciation" and "absolute return". Generally, such funds have low risk coefficient and low volatility.

To understand the real risk of a fund, we can look at the position of the fund. The risk of the fund is mainly judged by the proportion of shares held by the fund. If 70% of a fund's asset allocation is stocks, then this is a hybrid fund. If you are a risk-averse investor, you should avoid it. If the stock holding ratio of the fund reaches more than 90%, the risk coefficient will be high.

If the fund's bond position is relatively high, or almost all of it invests in bonds, then this fund is a bond fund or a partial debt fund, and the fluctuation will not be particularly large, as long as it is not a particularly conservative investor, it can be considered.

There is also a special situation here, that is, the holding ratio of some assets reaches 120% or exceeds 100%. It may be a leveraged fund, that is, the fund invests in external financing, and the addition of leverage will improve the volatility of the fund.