Fund, as explained in Modern Chinese Dictionary published by the Commercial Press, is: "Funds reserved or specially allocated for starting, maintaining or developing a certain cause." Such funds must be used for designated purposes and accounted for separately, such as poverty alleviation fund, education fund, courageous reward fund, energy and transportation key construction fund and so on.
The meaning of fund here is different from the above. It is the abbreviation of "securities investment fund" and is an investment and financial management tool. Its characteristics are as follows.
1. expert financial management is an indispensable part of people's contemporary life. In order to resist inflation and preserve and increase the value of financial assets, investment and financial management should and must be carried out. However, as an ordinary retail investor, they lack sufficient financial knowledge and don't have so much time and energy to take care of it. Investment fund is to spend a small amount of money, and the experts of the fund company invest in stocks, bonds and other instruments that can be invested in the financial market for you.
Fund companies have a group of experts with high academic qualifications and rich investment experience. They have keen observation, analytical judgment, can grasp a large amount of information in time, can make a more correct prediction of the price change trend of various varieties in the financial market, avoid mistakes in investment decision-making to the maximum extent, and improve the success rate of investment. For those small and medium-sized investors who don't have time or are not familiar with the market and can't specialize in investment decisions, investing in funds can actually gain the advantages of experts in market information, investment experience, financial knowledge and operation technology, so as to avoid the losses caused by blind investment as much as possible. Cheng Siwei, the former deputy director of the National People's Congress Standing Committee (NPCSC) and a famous economist, once said, "As an institutional investor of expert financial management, the fund has a relatively rational behavior and a relatively strong ability to prevent risks, which is conducive to the stable development of the market; On the other hand, funds can attract more people to enter the capital market. By purchasing funds, retail investors hand over the money to the fund manager to operate for him. The fund gives full play to the advantages of expert financial management, which can not only reduce the cost of retail investors, but also avoid greater risks. " Therefore, experts from fund companies can make less money when the stock market falls and earn more when the stock market rises.
2. There are so-called "makers" in the collective investment stock market, that is, those institutions or large households with huge sums of money have the ability to directly or indirectly manipulate the market, and the makers make profits through various means, causing losses to some small and medium investors. Individuals have limited funds for investment and financial management, and the amount is small. Compared with well-funded institutional investors and wealthy families, they are in a weak position and are often vulnerable. The entry threshold of fund investment is low, and it can be purchased as long as it is in 1 yuan, but fund companies are in a strong position in investment activities by concentrating a large number of small and medium-sized investors' funds.
3. * * * Enjoy the benefits and bear the risks * * *
The more customers a fund company has, the greater the amount of funds for financial management on behalf of customers, and the greater the income, the better the economic benefits. Therefore, under normal circumstances, fund companies are bound to devote themselves to making profits for their customers, so as to improve their reputation and popularity, increase their customers and expand their total assets. In the case that the fund is profitable, the income will be shared, and the company and customers will have the best of both worlds and be happy. In the case of fund loss, the risk will be borne.
4. A fund is a combination of stocks and bonds
The investment scope of a fund can be summarized as: stocks, bonds and other investment instruments permitted by laws and regulations, including interest-earning instruments in the money market such as large deposits and central bank bills, but mainly a combination of stocks and bonds. "You can't put all your eggs in one basket" is the motto of securities investment. However, to realize the diversification of investment assets, it needs certain financial strength. For small investors, due to limited funds, they can only invest in a few stocks. When the stock market falls or the financial situation of listed companies deteriorates, the principal will suffer great losses, and the fund can help small and medium investors solve this difficulty. With its abundant funds, the fund invests the funds in different kinds of securities with different maturities in different proportions within the investment scope stipulated by law, so as to minimize the risk, which is much smaller than that of a single investment in a certain stock.
Looking at the current investment channels in the market, there are stocks, bonds, funds, precious metals (gold and silver), commodity futures, stock index futures, foreign exchange, collections and warrants, etc. Except for funds, all of them need deep knowledge and rich operating experience, and the starting threshold is high, so it is difficult for ordinary amateur small and medium investors to get involved. From the above contents and, it can be clearly seen that the fund is a tool suitable for public investment.