In the investment market, investors often pay attention to the rise and fall of indexes and funds, because these can reflect the overall situation of the market. Sometimes we find that when the index goes up, the fund goes down. What is the reason?
We need to understand the concepts of index and fund. Index is a numerical value calculated by weighted average of some representative stock prices, which can reflect the trend of the whole stock market. Fund is a collective investment method, in which investors hand over funds to fund managers, who manage and invest in order to obtain income.
The index rises and the fund falls for the following reasons:
I. Different types of funds
When investing in funds, different types of foundations are affected in different ways. For example, stock funds mainly invest in the stock market, and bond funds mainly invest in the bond market. When the stock market rises, equity funds will naturally rise, and bond funds may fall. When the index rises, if you hold a bond fund, it may fall.
Second, the fund portfolio is different.
The portfolio of fund managers will also affect the rise and fall of funds. For example, a fund manager may choose different stocks and bonds for portfolio investment. If the selected stocks and bonds do not perform as expected, the fund may fall.
Three. Fund expenses
Fund handling fee is also one of the factors that affect the rise and fall of funds. Fund managers need to pay management fees and transaction fees, which will be deducted from the fund's net value. If the fund cost is too high, the net value of the fund will decline, leading to the decline of the fund.
Fourth, market sentiment.
Market sentiment will also have an impact on the rise and fall of funds. When the market is in a bad mood, investors often sell stocks and funds, which leads to the decline of funds. On the contrary, when the market is in a good mood, investors will buy stocks and funds, thus driving the fund to rise.
There are many reasons for the index to rise and the fund to fall, including fund types, fund investment portfolios, fund fees, market sentiment and so on. When choosing a fund, investors should choose the appropriate fund type and portfolio according to their investment objectives and risk tolerance, and at the same time pay attention to factors such as fund fees and market sentiment in order to obtain a better return on investment.