The risk of money funds is small, but the income is also quite limited, and sometimes even less than bonds. But the liquidity is good, and there is no possibility of loss.

The investment scope of the Monetary Fund is as follows (variety/income/risk):

1, cash: deposit income; Possible bank bankruptcy risk.

2. Bank time deposits and certificates of deposit within 1 year (including1year): deposit income; Possible bank bankruptcy risk.

3. Bonds with a remaining maturity of less than 397 days (including 397 days): coupon income and net transaction price income; Possible risk bond default and interest rate risk.

4. Bond repurchase with a maturity of less than 65,438+0 years (including 65,438+0 years): repurchase interest rate income; Possible counterparty default risk.

5. Central bank bills with a maturity of less than 1 year (including 1 year): coupon income and net transaction price income; Possible risk interest rate risk.

Extended data:

The main difference between money funds and other funds that invest in stocks is that the net asset value of each fund unit is fixed, which is usually 1 yuan per fund unit.

After investors invest in this fund, they can reinvest with the proceeds, and the investment income will accumulate continuously to increase the fund share owned by investors. For example, investors can own 100 fund shares if they invest 100 yuan. After 1 year, if the return on investment is 8%, the investor will have 8 more fund shares, totaling 108, with a value of 108 yuan.

The standard to measure the performance of money funds is the rate of return, which is different from other funds that make profits by increasing their net assets.

Monetary funds have good liquidity and high capital security. These characteristics are mainly due to the fact that the money market is a low-risk and high-liquidity market. At the same time, investors can transfer fund shares at any time as needed, regardless of the date.

The risk of money fund is low. The maturity of money market instruments is usually very short, and the average maturity of money fund portfolio is usually 4 ~ 6 months, so the risk is low, and its price is usually only affected by market interest rate.

The investment cost is low. Money funds usually don't charge redemption fees and have low management fees. The annual management fee of the money fund is about 0.25% ~ 1% of the fund's net asset value, which is lower than the traditional annual management fee 1% ~ 2.5%.

References:

Baidu Encyclopedia-Monetary Fund