Graded funds are also called "structured funds". Graded fund generally refers to dividing a parent fund into two parts, one is a class A sub-fund with agreed expected annualized expected return, and the other is a leveraged class B sub-fund to form two-level (or multi-level) risk expected annualized expected return. The advantage of this is that the performance of the fund is somewhat different, which reduces the risk of the expected annualized expected return of the fund. There are also skills in investing in graded funds, so what are the skills in investing in graded funds?

Net value of graded fund

Because graded funds are different from single funds such as bond funds, there are parent funds and sub-funds, so the calculation of the net value of graded funds is more complicated. The sum of the products of the net value of each sub-fund of the graded fund and the share ratio is equal to the net value of the parent fund. That is, the net value of the parent fund divided into two types of shares = the net value of class A sub-base X A share%+the net value of class B sub-base X B share%.

Skills of investing in graded funds

Skill 1 of investment grading fund: judge what kind of investor you are. Risk-averse people should invest in Class A shares in graded funds. The average annualized expected return can reach about 5%, and the risk is extremely low. Risk-averse people should invest in Class B shares in graded funds. Generally, the annualized expected return is higher and the risk is greater.

Investment grading fund skill 2: judge which stage the stock market is in. There are also bond funds, but there are more equity funds. Generally speaking, when the stock market is at the bottom and investors are optimistic about the market outlook, they should invest in Class B stocks, and when they are not optimistic about the stock market, they should invest in Class A stocks.

Tip 3: According to your own judgment on the market outlook and risk management, you can combine the A shares and B shares of different parent funds and flexibly handle the ratio between A shares and B shares.