People invest in fund products for profit. Usually, when the fund products fall, they will sell them. If an investor keeps holding a falling fund product, will it keep falling until the principal falls?

if the fund you buy keeps falling, will you lose all the principal?

the price of the fund will be affected by market fluctuation, which may lead to the rise and fall of the fund price. However, the fund will not completely lose its principal due to market fluctuations.

generally speaking, the assets of a fund are divided into two parts: investment portfolio and asset reserve. The portfolio includes stocks, bonds, money markets and other investment products, and the prices of these investment products will be affected by market factors. The asset reserve part is the cash and other assets with good liquidity held by the fund in order to maintain liquidity.

when the fund price falls, part of the value of the portfolio will also fall, but the value of the asset reserve is relatively stable, which can help the fund maintain liquidity. Therefore, even if the fund price falls, the overall risk of the fund will gradually decrease, and the principal will not fall.

of course, the income of the fund will not keep rising, and the income and price of the fund will be affected by market factors. However, the income of the fund is usually not lower than the principal, so it is necessary to plan and manage the risks reasonably when investing in the fund.