Stocks, bonds and funds belong to one kind of securities and are the most important financial instruments in the securities market. Essentially, it is capital security. Can be used as a means of financing and investment tools, there are still obvious differences between the three.

First, the difference between stocks, bonds and funds

The differences between stocks, bonds and funds are mainly reflected in five aspects, namely, different issuers, different income stability, different capital preservation ability, different economic benefits and different risks.

1. The issuing entities are different.

The issuer of stocks is a listed company, the issuer of bonds is a state-owned enterprise or a local public institution, and the issuer of funds is a fund company.

2. Income stability is different.

Generally, the return of stocks is uncertain before purchase, and the return of stocks is constantly changing with the change of profitability of listed companies. When the company has more profits, it has more profits, when the company has less profits, it has less profits, and when the company loses money. We will also lose money.

Before we buy bonds, the yield has been completely determined, and we can get fixed interest after maturity.

There are many kinds of funds, such as index funds, stock funds, hybrid funds, bond funds and money funds, and their income stability is different. Index funds, stock funds and hybrid funds are mostly used to invest in stocks, and their income stability is as uncertain as stocks.

Bond funds, on the other hand, mainly invest in bonds, with relatively stable returns. Monetary funds mainly invest in some short-term monetary instruments, such as government bonds, central bank bills, commercial bills, bank deposit certificates, short-term government bonds, corporate bonds, etc. Although the income is uncertain, it is relatively stable and the risk is very small, which can be ignored.

So the rate of return will not be very high. The annualized rate of return of general money funds is between 3% and 5%, which fluctuates every day.

3. The capital preservation ability is different.

Stocks do not guarantee profits and losses, and they do not expire. Once the principal is handed over to the company, it cannot be sold back to the company. As long as the company does not go bankrupt, the money you invest will always be dominated by listed companies.

Bonds generally have a fixed term, after which the principal and fixed interest can be recovered.

Funds will not protect their capital and losses, but in general, bond funds and money funds are unlikely to lose money, and investors who want to protect their capital can also choose these two funds.

4. Different economic interests.

Shareholders of a listed company are shareholders of the company. They have the right to directly or indirectly participate in the operation and management of the company, attend the shareholders' meeting, and have partial ownership of the company.

Bondholders have no right to ask about the operation and management of the company, and bonds can only express certain creditor's rights to the company.

In this regard, funds are somewhat similar to bonds. A fund is a product of a fund company that we subscribe for or buy. The fund company invests in stocks or bonds with the raised funds, so that we can get some income. When we buy a fund, we have no right to interfere with any behavior of the listed company where the shares held by the fund are located, and we have no ownership.

5. Different risks

Stocks are the main investment targets in financial markets. The trading and transfer rate of stocks is high, the market price will change greatly, the security is low and the risk is high, but it can also obtain very high expected returns.

The general investment object of bonds is much lower than that of stocks, and the price fluctuation will not be great, so the risk is much smaller than that of stocks.

The risks of funds vary according to the types of funds. The risks of index funds and equity funds are also high, the risks of hybrid funds are relatively low, and the risks of bond funds and money funds are even lower.

Second, the relationship between bonds, stocks and funds.

Dynamically, stock returns and bond prices are interactive. With linkage, generally speaking, it will run in the same direction, that is to say, the stock market will rise, the bond market will also rise, and the stock market will fall.

The bond market will also fall, but their ups and downs are far apart.

Index funds, stock funds and hybrid funds mostly invest in stocks, so when the stock market rises, these funds will also rise, and when the stock market falls, these funds will also fall.

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