Monetary fund
Monetary fund is an open-end fund that collects idle social funds, is operated by fund managers and kept by fund custodians. It specializes in investing in low-risk money market instruments, which is different from other types of open-end funds. It has the characteristics of high security, high liquidity, stable income and "quasi-savings".
Advantages and disadvantages of monetary fund
Advantages of monetary fund
1. Guaranteed floating expected return. The investment risk of money market funds is very low, which can ensure the safety of principal.
These funds are highly liquid. Under normal circumstances, money funds are short-term investments and can be purchased and redeemed at any time. After applying for redemption, you can get the money within 2 days, which is highly liquid and has both the liquidity of demand deposits and the expected rate of return of time deposits.
3. Compared with the savings rate, the expected rate of return is higher. Compared with bank deposits, the interest rate of money funds is higher than that of bank deposits, and the expected income is higher.
4. Low risk. The issuers of financial instruments held by money market funds and the participants in the money market are both financial institutions or government departments with extremely high credit ratings, so the credit risk and operational risk are low, which is suitable for steady investment and meets the safety requirements.
5. Low starting point and convenient operation. The subscription starting point of money market funds is mostly around 1 10,000 yuan, and some can start at 1 yuan. The operation is simple and very convenient.
6. There is no need to pay the formalities fee, and there is no need to pay the subscription and redemption fee when purchasing this fund, so the cost is low.
Shortcomings of the money fund
1. Compared with other funds, the expected rate of return is lower and may be lowered in the future;
2. The issuers of some money funds have weak ability to resist risks, and there will be higher market risks.
The above is the relevant content of the advantages and disadvantages of the money fund, and I hope it will help everyone. Warm reminder, financial management is risky and investment needs to be cautious.