First, should bond funds buy first-class or second-class?
The primary bond fund and the secondary bond fund have different investment objects and scope, so the investment risks are different and the suitable investors are different.
On the basis of investing in fixed-income wealth management products, primary bond funds can also invest in bonds and new shares in the primary market, but they do not participate in stock trading in the secondary market; Position allocation is to combine bonds with high expected returns to make new shares. On the basis of investing in fixed-income wealth management products, secondary bond funds can not only participate in the trading of stocks in the secondary market, but also participate in the investment of new shares in the primary market; The allocation of positions is high expected return bonds, new shares and selected stocks. The asset allocation of secondary bond funds has one more stock option than that of primary bond funds.
In other words, the investment targets of Tier 1 bond funds are mainly fixed-income wealth management products, and at most, they will invest in some new shares issued in the issuance market. Generally speaking, the risk level is moderately low and relatively controllable; The investment targets of secondary bond funds are more abundant. On the basis of the investment of the primary bond fund, it can also directly participate in the stock trading in the secondary market, so as to increase the upper limit of the income of the secondary bond fund and the risk level.
To sum up, conservative investors who pursue steady income might as well buy a first-class bond fund to get more steady income. Investors with moderate risk preference want to pursue higher investment returns, so it is better to buy secondary bond funds and get higher returns.
2. Which is the higher income of Tier 1 and Tier 2 bond funds?
Judging from the investment scope of bond funds, the income of secondary bond funds will be higher. Because primary bond funds mainly invest in pure bonds and new shares in the primary market, the income mainly comes from bond interest and new share spreads. In addition to pure bonds and new shares, secondary bond funds have no more than 20% positions that can be invested in the secondary market to buy and sell stocks directly. In other words, secondary bond funds can allocate individual stocks in their assets, and the upper limit of income is higher than that of primary bond funds.
Because some secondary bond funds invest in the stock market, their risks are higher than those of primary bond funds. In addition to the risks from the stock market, hybrid bond funds may also face the risks of changes in market interest rates, credit risks caused by bond issuers' default, and market inflation risks. Therefore, investors can't blindly pursue the return on investment and ignore the risks of products. Before buying hybrid bond funds, investors must choose carefully and invest rationally according to their own risk tolerance. At the same time, we should also learn to take profit and stop loss and maintain a stable investment mentality.