fund

From the perspective of capital relationship, the fund refers to the funds specially used for specific purposes and independently accounted for. Among them, including endowment insurance fund, retirement fund, relief fund, education reward fund, etc. In various countries, there are also special financial funds, collective welfare funds for employees, key construction funds for energy and transportation, and budget adjustment funds unique to China.

In terms of organizational nature, a fund refers to an institution or organization that manages and operates funds dedicated to specific purposes and conducts independent accounting. Such fund organizations can be non-legal institutions (such as financial special funds, college education incentive funds, insurance funds, etc.). ), public institutions (such as Soong Ching Ling Children's Foundation in China, Sun Economics Prize Foundation, Mao Dun Literature Prize Foundation, Ford Foundation and Huo Burridge Foundation in the United States, etc. ) or corporate institutions.

investment fund

Investment fund refers to an investment organization system that uses the mechanism of modern trust relationship to pool the scattered funds of various investors in order to achieve the expected investment purpose in accordance with the basic principles of * * * joint investment, * * * enjoying the benefits and * * * taking risks and some principles of joint-stock companies.

securities investment funds

Securities investment fund is a kind of collective securities investment model with * * * returns and * * risks, that is, investors' funds are pooled by issuing fund shares, managed by fund custodians, managed and used by fund managers, and invested in financial instruments such as stocks, bonds, foreign exchange and currencies to obtain investment returns and capital appreciation. The names of investment funds are different in different countries or regions. In the United States, they are called "mutual funds", in Britain and Hongkong, they are called "unit trust funds", and in Japan and Taiwan Province Province, they are called "securities investment trust funds".

Fund classification

According to different standards, investment funds can be divided into different types.

1. According to whether the fund units can be increased or redeemed, investment funds can be divided into open-end funds and closed-end funds. Open-end fund refers to an investment fund with a fixed scale. After the fund is established, investors can purchase or redeem the fund shares at any time. Closed-end fund refers to an investment fund whose fund scale has been determined before issuance and fixed within a specified period after issuance.

2. According to different organizational forms, investment funds can be divided into corporate investment funds and contractual investment funds. Corporate investment fund is a profit-oriented joint-stock investment company composed of investors with the same investment objectives, and invests its assets in specific objects; Contractual investment funds, also known as trust investment funds, refer to investment funds formed by fund sponsors issuing fund shares according to fund contracts concluded with fund managers and fund custodians.

3. According to different investment risks and returns, investment funds can be divided into growth investment funds, income investment funds and balanced investment funds. Growth-oriented investment funds refer to investment funds whose investment purpose is to pursue long-term capital growth; Income fund refers to an investment fund whose purpose is to bring high-level current income to investors; Balanced investment fund refers to the investment fund whose purpose is to pay the current income and pursue the long-term growth of capital.

4. According to different investors, investment funds can be divided into stock funds, bond funds, money market funds, futures funds, option funds, index funds and warrant funds. Stock fund refers to an investment fund with stocks as the investment object; Bond funds refer to investment funds that invest in bonds; Money market funds refer to investment funds that invest in short-term securities in the money market, such as treasury bills, negotiable certificates of deposit of large banks, commercial bills, corporate bonds, etc. Futures funds refer to investment funds that mainly invest in various futures varieties; Option fund refers to an investment fund that takes stock options that can distribute dividends as the investment object; Index fund refers to an investment fund that takes the price index of a securities market as the investment object; Warrant fund refers to an investment fund with warrants as its investment object.

5. According to the types of investment currencies, investment funds can be divided into dollar funds, yen funds and euro funds. Dollar funds refer to investment funds that invest in the dollar market; Japanese yen fund refers to an investment fund that invests in the Japanese yen market; Euro fund refers to an investment fund that invests in the euro market.

In addition, according to the different sources of funds and regions, investment funds can be divided into international funds, overseas funds, domestic funds, national funds and regional funds. International funds refer to investment funds with domestic capital and investing in foreign markets; Overseas funds are also called offshore funds. Refers to investment funds whose capital comes from abroad and invests in foreign markets; Tongnei Fund refers to an investment fund whose capital comes from China and invests in the domestic market; State funds refer to investment funds whose capital comes from abroad and invests in specific countries; Regional funds refer to investment funds that invest in specific fields.

The role of the fund

The role of securities investment funds

1. The fund broadens the investment channels of small and medium investors.

For small and medium investors, it is safer to save or buy bonds, but the yield is low; Investing in stocks may have a higher return, but it is risky. As a new investment tool, securities investment fund brings together the small funds of many investors.

Portfolio investment is managed and operated by experts, with stable operation and considerable income. It can be said that it is an indirect investment tool specially designed for small and medium investors, which greatly broadens the investment channels of small and medium investors. It can be said that the fund has entered the homes of ordinary people and become a popular investment tool.

This fund has effectively promoted industrial development and economic growth by converting savings into investment.

The fund absorbs social idle funds, creates a good financing environment for enterprises to raise funds in the securities market, and actually plays a role in transforming savings funds into production funds. This mechanism of converting savings into investment provides an important source of funds for industrial development and economic growth, and with the development of the fund, this role is becoming more and more important.

3. Conducive to the stability and development of the securities market.

First of all, the development of the fund is conducive to the stability of the securities market. The stability of the securities market is closely related to the investor structure of the market. The emergence and development of funds can effectively improve the investor structure of the securities market and become the backbone of stabilizing the market. The Fund is managed by professional investors, with rich investment experience, complete information, advanced analysis methods and relatively rational investment behavior, which can objectively stabilize the market. At the same time, funds generally pay attention to the long-term growth of funds, adopt long-term investment behavior, and enter and leave the securities market less frequently, which can reduce the fluctuation of the securities market. Second, as a financial instrument that mainly invests in securities, the emergence and development of funds have increased the investment varieties of the securities market, expanded the trading scale of the securities market, and played a role in enriching and activating the securities market. With the development of the fund, it has become an important driving force to promote the development of the securities market.

4. Conducive to the internationalization of the securities market.

Many developing countries are cautious about opening their own securities markets. In this case, they should cooperate with foreign countries.

It is a wise choice to set up a fund and gradually and orderly introduce foreign investment into the securities market. Compared with opening the securities market directly to investors, this way enables the regulatory authorities to control the scale of utilizing foreign capital and the degree of market opening.

The Development Course of China Fund Industry

China's investment funds started in 199 1 year, marked by the promulgation and implementation of the Interim Measures for the Management of Securities Investment Funds in 1997+00, which is divided into two main stages.

I. Development of investment funds before1997199 1010 In October, when the China stock market just started, Wuhan Securities Investment Fund and Shenzhen Nanshan Venture Capital Fund were approved by Wuhan Branch of the People's Bank of China and Shenzhen Nanshan Venture Capital Zone respectively, becoming the first batch of investment funds. Since then, only in 1992, 37 investment funds have been issued with the approval of the people's banks at all levels or other institutions. Among them, "Zibo Township Enterprise Fund" was approved by the head office of the People's Bank of China and listed on the Shanghai Stock Exchange on August 1993, becoming the first listed investment fund. At the beginning of 1993, with the approval of the head office of the People's Bank of China, three education funds, Jianye, Jinlong and Baoding, were issued in Shanghai, raising 300 million yuan, and were listed and traded on the Shanghai Stock Exchange at the end of that year. By the end of 1997 and 10, there were 72 domestic investment funds, raising 6.6 billion yuan. Its characteristics are as follows:

1, with a single organizational form. All 72 funds are closed-ended, except Zibo Township Enterprise Investment Fund, Tianji Fund and Blue Sky Fund, the others are contractual.

2. Small scale. The largest single fund is the space-based fund, with 580 million yuan, and the smallest is the first phase of Wuhan Fund, with only 65.438+million yuan. The average scale is 80 million, and the total scale is only 6.6 billion.

3. Wide investment scope and low asset quality. The assets of most investment funds are composed of securities, real estate and financing, among which real estate accounts for a considerable proportion and has low liquidity. The results of the statistical investigation at the end of 1997 show that its investment scope is roughly as follows: monetary fund 14.2%, stock investment 3 1%, bond investment 3.5%, real estate and other industries investment 28.2%, and other investments account for 23. 1%.

4. The range of fund sponsors is very wide. The sponsors of investment funds include banks, trust and investment companies, securities companies, insurance companies, finance and enterprises, among which trust and investment companies account for 565,438+0% and securities companies account for 20%.

5. The income level varies greatly. During the period of 1997, Tianji Fund with the highest income level achieved a rate of return of 67%, while Longjiang Fund with the lowest income level only achieved a rate of return of 2.4%.

There are some problems in the initial stage of investment fund industry in China, including:

First of all, there is a lack of clear and effective supervision institutions and rules in the establishment, management and custody of funds. For example, the establishment of most funds is examined and approved by the local branches of the People's Bank of China or local governments according to local laws and regulations (such as the Interim Provisions on the Administration of Investment Trust Funds in Shenzhen). There is no uniform standard, and even there are great differences in names. After the fund was approved to be established, the examination and approval authorities failed to fulfill their regulatory obligations, and lacked corresponding supervision and restriction mechanisms in fund asset operation and investment direction.

Second, the operation and management of some investment funds are not standardized, and the rights and interests of investors have not been fully protected. For example, some fund managers, custodians and sponsors are trinity, and the fund is only a source of funds for the fund manager, and the fund assets are mixed with the fund manager's assets, which leads to confusion in accounting treatment. Another example is that the fund custodian did not play a supervisory role, and the behavior of the fund manager was not effectively monitored.

Third, the liquidity of assets is low, and the book asset value is higher than the actual asset value. A large number of assets of investment funds are invested in real estate, projects, legal person shares and other assets with low liquidity, and at the same time there is the problem of overvaluation of assets. For example, in the mid-1990s, when the real estate bubble was gradually eliminated in some areas, the assets stored in real estate were still priced at cost, not adjusted according to the market price, which made the book value of individual fund assets higher than the actual asset value.

Second, the development of China Securities Investment Fund after 1997 10.

The Interim Measures for the Management of Securities Investment Funds was issued in June of 1997+0O, which indicated that China's securities investment funds entered a stage of standardized development. The Interim Measures clearly regulate the establishment, raising and trading of securities investment funds, the rights and obligations of fund custodians, fund managers and fund holders, and the operation and management of investment. 1March, 1998, the establishment of Jintai and Open Source Securities Investment Funds marked that standardized securities investment funds began to become the leading direction of China's fund industry. As the first open-end fund, 200 1 Huaan Innovation Investment Fund has become another milestone in the development of China's fund industry. At the same time, the cleaning, reorganization and raising of the original investment funds are also in progress, and some of them have reached the standard requirements and re-listed as new securities investment funds.

By the end of 1 1 in 2002, there were seven fund management companies 17 that were formally established and standardized, and 54 closed-end securities investment funds and 7 open-end funds 17, of which the issuance scale of closed-end funds reached 8010.7 billion yuan, with a market value of about 77.3 billion yuan. At the same time, the continuous improvement of the Interim Measures for the Management of Securities Investment Funds and its implementation guidelines, the Listing Rules of Securities Investment Funds and the Pilot Measures for Open-ended Securities Investment Funds have also laid a solid foundation for the standardized development of securities investment funds.

At present, the main features of China Securities Investment Fund are as follows:

1. The continuous improvement of laws and regulations and the strengthening of supervision have created a good external environment for the operation of the fund industry and promoted its rapid development. A number of fund laws and regulations have been promulgated one after another. The Fund Supervision Department of China Securities Regulatory Commission, as the main implementation department of fund supervision, effectively supervises the establishment, operation and custody of fund management companies and funds. Once the Investment Fund Law is officially promulgated and implemented, it will also become the core legal basis for the development of China's fund industry.

2. With the continuous expansion of the fund scale, its influence on the market is increasing, and it has gradually become an important institutional investor that cannot be ignored in the securities market. It includes not only newly issued closed-end and open-end funds, but also standardized securities investment funds formed after the original investment funds are cleaned up, reorganized and raised. At present, the total market value of securities investment funds supervised by China Securities Regulatory Commission is close to 80 billion yuan, which is equivalent to about 7% of the circulating market value of Shanghai and Shenzhen stock markets.

3. The variety of funds is increasingly diversified, and the investment style is gradually highlighted. Since the development of the first batch of balanced funds from 65438 to 0998, there have been different styles of funds such as growth, value and compound, especially with the gradual introduction of open-end funds, the style of funds has become more distinct, providing investors with various investment choices.

4. Facing the competition pattern after China's entry into WTO, fund management companies have extensively cooperated with foreign countries, learned advanced management and technical experience, and promoted the innovation of fund products and operations, laying a foundation for China's entry into the international financial market competition.

Development course of overseas fund industry

Investment funds originated in Britain, and have been greatly developed and popularized since they were introduced to the United States in the 1920s. Today, the investment fund industry in the United States has the largest assets and the most perfect management system in the world, and the United States is called the fund kingdom. After World War II, investment funds spread all over the world.

1, the development of British investment funds

Britain is the birthplace of modern investment funds. /kloc-In the mid-9th century, Britain accumulated a lot of wealth by developing industry and expanding abroad, which made the domestic interest rate drop continuously, and the capital sought a way to increase its value abroad. On the other hand, European and American countries are in urgent need of a large amount of funds in the process of industrialization, so they have come to Britain to issue various securities to raise funds. Therefore, investment trust came into being. 1868, the world's first investment trust "Trust for Foreign and Colonial Governments" was born in Britain. When the fund was established, it raised 6,543,800 pounds, and its operation mode was similar to that of modern closed-end contract funds. The relationship between the two parties is bound by the contract, and the agent is entrusted to use and manage the fund assets, and a fixed interest rate system is implemented. Subsequently, the first professional fund management institution, Scottish American Trust, was established in 1873, and the British Limited Company Act was promulgated in 1879. Since then, investment funds have entered the era of professional management of joint-stock companies from contractual type. The first fund with the embryonic form of modern open-end fund appeared in 193 1. 1943, Britain established the "Overseas Government trust deed" organization, which not only stipulated that fund companies should redeem fund units according to their net assets, but also defined a flexible portfolio in the trust deed, marking the beginning of modern British securities investment funds.

Closed-end funds in Britain generally raise funds from the public in the form of investment trust company shares, while open-end funds generally exist in the form of unit trust funds. The popularity of unit trust funds and the total assets under management exceed that of investment trust companies. By the end of 1997, there were 154 unit trust fund management companies and nearly 1600 unit trust funds in Britain, with assets under management exceeding150 billion. There are more than 570 investment trust companies, with assets of 58 billion pounds under management.

2. Overview of the development of American investment funds

After World War I, the American economy was unprecedentedly prosperous, and investment activities at home and abroad were extremely active. At the same time, economic changes are often complicated. In this case, the British investment fund system was introduced to the United States. The first modern investment fund, Massachusetts Investment Trust, was born in Boston on 1924.

After the emergence of investment funds in the United States, the development was relatively slow due to the Great Depression and World War II in the early 1930s. The United States promulgated the securities law on 1933, the securities exchange law the following year, and the investment company law on 1940. These laws, especially the investment company law of 1940, regulate the composition and management elements of investment funds in detail, and provide investors with complete legal protection, thus laying a legal foundation for the sound development of investment funds.

After World War II, the rapid growth of American economy in 1950s and 1960s promoted the development of investment funds. 1970 In the United States, there were 36 1 investment funds with total assets of nearly $50 billion and more than10 million investors. In 1970s, American economy experienced stagflation, high unemployment rate was accompanied by high inflation rate, the development of investment funds also entered a downturn, and the number of investors and the scale of assets under management were shrinking. After 1980s, domestic interest rates in the United States gradually decreased and tended to be stable, and economic growth and stock market prosperity also made investment funds develop rapidly. Especially in the middle and late 1980s, the long-term average return of the stock market was higher than that of bank deposits and bond interest rates, and the development of investment funds made a great leap. In 1990s, with the rapid development of world economic integration, the concept of investment globalization dominated the development of American investment funds. At the same time, the rapid growth of domestic economy during Clinton's administration made the stock market soar unprecedentedly and the stock funds expanded rapidly. At present, the total assets of American mutual funds have reached 7 trillion US dollars, with about 40 million holders, and 50% of households have invested in funds, accounting for about 40% of all household assets.

* * * American funds are divided into closed-end funds and open-end funds. The origin of closed-end funds is earlier than that of open-end funds, but open-end funds quickly surpass closed-end funds because of their convenience to investors. At present, there are only about 500 closed-end mutual funds, mostly bond funds and state funds, while the number of open-end funds is as high as more than 5,000, with various types.

3. Development of investment funds in Hong Kong and Taiwan.

The development of funds in Hong Kong. Investment funds appeared in Hong Kong as early as 1960. However, due to the limitation of economic development level and investors' ignorance of funds, the development of fund market before 1970s was not ideal. It was not until 1980s that the development of investment funds showed great vitality, and the number and total assets of funds rose rapidly, becoming the largest fund management center in Asia except Japan. In the1990s, the development of Hong Kong investment funds inherited the strong momentum in the late1980s. By the end of 1997, there were 46 fund management companies and 788 investment funds in Hong Kong, with total assets of about 63.859 billion US dollars. During the period of 1997, the performance of Hong Kong investment funds invested in different regions was quite different. For example, the return rate of European equity funds is 17.33%, that of American equity funds is 13.57%, that of bond funds is 7.4%, that of Hong Kong equity funds is 19.36%, and that of Japanese equity funds is 24.97%. Among them, the stocks invested by Hong Kong, Japan and ASEAN funds fell sharply due to the financial crisis in Southeast Asia, which seriously affected the fund performance.

The development of funds in Taiwan Province Province. Taiwan Province Investment Fund was born in 1983. Although the time is short, it has developed rapidly, and it has experienced the development process of foreign capital participating in the establishment of fund management institutions, raising funds outside the island and international funds investing in the securities market outside the island. By the end of 1997, there were 56 investment funds in Taiwan Province province with total assets of 1635438+0 billion USD. There are 1 15 funds focusing on stock investment, 37 funds focusing on bond investment and 4 other funds, of which the total assets of stock funds are 9.602 billion US dollars, accounting for 58% of the total assets of the whole fund. At present, there are 2 1 fund management companies in Taiwan Province province, with assets under management of 780 million USD on average. From 65438 to 0997, the average rate of return of funds in Taiwan Province Province was 26.26%.

Comparison between funds and other wealth management products

Comparison between funds and other wealth management products

I comparison of funds with stocks and bonds

Securities investment fund is a collective securities investment model with * * * risk * * *, that is, investors' funds are pooled by issuing fund shares, managed by fund custodians, managed and used by fund managers, and invested in financial instruments such as stocks and bonds.

Capital. Stock is a certificate issued by a joint-stock company to prove the shares held by shareholders, and it is the form of company shares. Investors become the owners of the issuing company by buying shares, get operating income according to their shareholding shares and participate in major decision-making voting. Bonds refer to securities issued in accordance with legal procedures and agreed to repay the principal and interest within a certain period of time. Its characteristics are fixed income and less risk.

Compared with stocks and bonds, securities investment funds have the following differences:

(1) Investors have different status. Shareholders are shareholders of the company and have the right to express their opinions on major decisions of the company; The bondholder is the creditor of the bond issuer and has the right to recover the due principal and interest; The fund unit holder is the beneficiary of the fund, which reflects the trust relationship.

(2) The degree of risk is different. Generally speaking, the risk of stocks is greater than that of funds. For small and medium-sized investors, due to the limitation of the total amount of disposable assets, they can only directly invest in a few stocks, which violates the investment taboo of "putting all the eggs in one basket". When the stock they invest in falls due to the stock market or the financial situation of the enterprise deteriorates, their capital may be wiped out; The basic principle of the fund is portfolio investment, risk diversification, and investment in securities with different maturities and types in different proportions to minimize risks. Under normal circumstances, the principal of the bond is guaranteed, the income is relatively fixed, and the risk is smaller than that of the fund.

(3) The income situation is different. The returns of funds and stocks are uncertain, while the returns of bonds are certain. In general, the fund's income is higher than that of bonds. Taking American investment funds as an example, the income growth rate of 25 kinds of funds, such as international investor funds, is 301976 ~1981.6% on average, among which the growth investor funds in the 20th century have the highest rate of 465% and the lowest rate of 243%. However, the interest rates of two kinds of five-year government bonds issued in China 1996 are only 13.06% and 8.8% respectively.

(4) Different investment methods. Unlike investors in stocks and bonds, securities investment funds are an indirect way of securities investment. Fund investors no longer directly participate in securities trading and bear investment risks, but experts are specifically responsible for the determination of investment direction and the choice of investment objects.

(5) Different price orientations. In the case of consistent macro-political and economic environment, the price of the fund is mainly determined by the net asset value; The main factor affecting bond prices is interest rate; The stock price is greatly influenced by the relationship between supply and demand.

(6) Different ways of investment recovery. Bond investment has a certain term, and the principal will be recovered after the maturity; Stock investment is uncertain. Unless the company goes bankrupt and liquidates, investors shall not recover their investment from the company. If they want to take it back, they can only realize it at the market price in the stock exchange market. Investment funds vary according to the form of funds held: closed-end funds have a certain term, after which investors can share the corresponding remaining assets according to their shares. It can also be realized in the closed-end trading market; Open-end funds generally have no term, but investors can ask the fund manager for redemption at any time.

Although several investment tools have the above differences. But there are also many connections between them:

Funds, stocks and bonds are all securities, and investments in them are all securities investments. The division of fund shares is similar to that of stocks: stocks are divided into "shares" and their total assets are calculated; Fund assets are divided into several "fund units", and investors share the value-added income of the fund according to the share of holding fund units. Contractual closed-end funds are similar to bonds, and the investment will be recovered once the contract expires. In addition, stocks and bonds are the investment targets of securities investment funds, and there are stock funds and bond funds specializing in stocks and bonds abroad.

Second, the comparison between open-end funds and bank savings

There are many similarities between open-end funds and bank deposits: first, their access or purchase and redemption can be carried out in the same branch of a commercial bank, without involving other institutions and departments, and depositors or investors only need to go through relevant procedures in front of the bank; Secondly, everyone can exchange cash at any time at a small cost; Finally, both incomes are relatively stable. The income of deposit is deposit interest, and its amount is generally fixed. Under normal circumstances, interest income is completely guaranteed. The income from investing in an open-end fund is the increase in the net value of the fund. In the process of operation, fund managers use their portfolios to avoid unsystematic risks to the greatest extent, and in mature markets, fund managers can also avoid systemic risks through risk hedging mechanism, so the income from investing in open-end funds is relatively safe and stable under normal circumstances.

Although there are many similarities between the two, there are still essential differences, mainly as follows:

First, the capital investment direction of the two is different. Banks put savings deposits into production or consumption areas through corporate loans or personal credit channels to obtain spread income; Open-end funds invest investors' funds in the securities market, including stocks and bonds, and obtain stable income through stock dividends or bond interest, and at the same time obtain capital income through the price difference in the securities market.

Second, there are essential differences between deposit contracts and fund contracts, with different risks. The risk of bank savings deposits is much smaller than that of open-end funds. The deposit contract belongs to the creditor's rights contract, and the bank has full legal debt repayment responsibility to the depositor; Open-end funds put the raised funds into the securities market, and fund managers only manage the funds but not the investors. The fund contract belongs to the equity contract, and the fund manager does not guarantee the rate of return of the fund. When investors redeem funds, they get funds according to the net value of each fund. If the fund is well managed, the net value of the fund will increase and investors will get higher returns; If the stock market is not good or the fund manager is not well managed, the net value of the fund will fall and investors will suffer losses. Risk is directly related to the stock market and the management level of managers.

Third, their incomes are different. The income from bank savings deposits is interest. In general, the interest rate is relatively fixed regardless of the bank's benefit. Under normal circumstances, the yield of open-end funds is higher than the deposit interest rate, but the income of funds is not fixed. If the market is good and the managers operate well, the income of funds will be higher than the deposit interest rate, and vice versa. In addition, the income of different funds is different, and the deposit interest rates of different banks are basically the same.

Fourth, the transparency of the information they manage is different. After banks absorb deposits, they have no obligation to disclose the operation of funds to depositors, and depositors generally don't care; Open-end fund managers must regularly announce the fund investment and fund net value to investors, and investors can always know how much cash their investment can cash out.

Fifth, the cost of converting them into cash is different. There is no need to pay any fees for access to bank deposits; The redemption and subscription of open-end funds need to pay a certain fee, so investors' capital conversion has a certain cost.

Whether investing in open-end funds or depositing them in banks in the form of savings, investors may wish to arrange the investment of funds according to their personal funds, risk tolerance and future demand for funds on the basis of fully comparing their similarities and differences and advantages and disadvantages.

What is an index fund?

Index fund is a kind of fund with the principle of fitting the target index and tracking the change of the target index to realize the synchronous growth with the market. The investment of index funds adopts the investment strategy of fitting the target index return rate, and invests in the constituent stocks of the target index in a diversified way, so that the stock portfolio return rate fits the average return rate of the capital market represented by the target index.

What is an umbrella fund?

Umbrella fund is actually an organizational structure of open-end fund; Under this organizational structure, the fund sponsors initiated the establishment of a number of funds that can only be converted according to the prescribed procedures according to a general fund prospectus. These funds are called sub-funds or constituent funds. The fund system composed of these sub-funds is called umbrella fund. Furthermore, umbrella fund is not a specific fund, but a management method of many funds initiated and managed by the same fund sponsor. Therefore,

It is generally believed that the term "umbrella structure" may be more appropriate.

What is LOF Fund?

LOF funds are called "open-end funds" in English and "listed open-end funds" in Chinese. In other words, after the issuance of listed open-end funds, investors can purchase and redeem fund shares at designated outlets, or buy and sell funds on exchanges. However, if investors want to sell the fund shares purchased at designated outlets, they must go through certain transfer custody procedures; Similarly, if you want to redeem the fund shares you bought online on the exchange and redeem them at designated outlets, you must also go through certain transfer custody procedures.

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