Risk of money fund
Market risk: judging from the investment scope of the money fund, it is mainly cash deposits with a term of less than one year and bonds with high credit rating, and its credit rating is the highest in the fund rating system. Therefore, generally speaking, the assets invested by the money fund are less risky and the principal loss is very small. However, if the market falls sharply (economic crisis, etc. ), there will also be losses.
Operational risk: Issuer: If investors buy the monetary fund of a company with weak anti-risk ability, if the fund company has economic problems, or the fund is liquidated, resulting in losses. Run risk: This risk comes from larger fund companies. If the company suddenly has a big loophole, it will lose money to run away or close down.
Monetary fund is an open-end fund that collects idle social funds, is operated by fund managers and kept by fund custodians. Special investment in risk-free money market instruments, different from other types of open-end funds, has the characteristics of stable income, high security, high liquidity and "quasi-savings". The investment scope of money market funds is a variety with high safety factor and stable income, so for many enterprises and individuals who want to avoid the risks in the securities market, money market funds are a natural haven, which can not only obtain the income higher than the interest of bank deposits, but also ensure the safety of the principal.
Monetary fund losses.
The risk level of the money fund is low, and losses will only occur if the following two situations occur at the same time.
1, the market interest rate rose sharply in a short time, which led to a sharp drop in securities prices;
2. There are a lot of redemptions at the same time, and investors sell bonds when they can't hold bonds with falling maturity prices, resulting in losses.
Possibility of monetary fund loss
Although the money fund is losing money under certain conditions, it is very unlikely that the decline in securities prices and the massive redemption of the money fund will happen at the same time, so the probability of the actual loss of the money fund is extremely low. Judging from the history of the money fund, there is almost no situation in which someone invested in the money fund but lost the principal.
In addition, the investment scope of money funds is mostly in low-risk areas such as cash, bank deposits, bonds and central bank bills. The high security in the field of asset allocation can also show that the possibility of money fund losses is not great.