Many fund investors don't know how to judge the quality of a fund. In many cases, they may make a bet by patting their heads, but they may not know exactly what the fund they choose. How to judge whether a fund is good or not? What do you mainly look at? So today, Bian Xiao is here to sort out the relevant knowledge of the fund for everyone. Let's have a look!

How to judge whether a fund is good or not?

Whether the fund is good or not, performance is king. Investors can usually refer to the following indicators to judge the performance of the fund:

1, total net assets

If the investment income of a fund is high, it will attract more investors to invest in the fund and make the growth of the total net assets of the fund higher than the average level. In other words, if the total net assets of a fund are increasing, it means that the fund is performing well and can be invested.

2. Changes in unit net value

The subscription and redemption of open-end funds are based on the fund's unit net value, and the change of unit net value is also the most common and obvious indicator reflecting the change of a fund's performance. If the change direction of the net value of a fund unit is steady and upward, it means that the performance of this fund has risen steadily and can be invested.

3. Return on investment

The return on investment is the net growth rate of the fund in a certain period of time. The higher the return on investment, the better the performance of the fund, and the more investment income investors get. Generally, when buying a fund, you can check the return on investment of the fund over a period of time, but investors should pay attention not only to a certain period of time, but also to several years. After all, sometimes the fund fluctuates greatly, and the return on investment may be distorted at some time.

4. Sharp ratio

Sharp ratio is a special index to measure fund performance. Its calculation method is to subtract the risk-free interest rate from the average value of the fund's net growth rate over a period of time and then divide it by the standard deviation of the fund's net growth rate. When buying a fund, you can check the sharp ratio of the fund in the fund analysis index. It can make up for the defect that the growth rate of net value depends only on income, and consider both income and risk. A simple understanding is how much risk we take and get a certain return. The greater the value, the higher the risk-return of fund unit or the lower the risk of unit return. Of course, if the value is negative, it means that the average net growth rate of the fund during this period is lower than the risk-free interest rate (such as the bank deposit interest rate).

What is a fund?

Broadly speaking, funds, like bank deposits, stocks and bonds, are investment and wealth management products. However, funds belong to the indirect securities investment mode. Fund companies issue fund shares to investors for purchase, and then pool investors' funds to invest in financial instruments such as stocks, bonds and currencies. In other words, if you don't directly invest in stocks and bonds, and there happens to be a special fund to help you invest, you have to bear the risks and benefits of investment, and you need to pay a certain fee to the fund that helps you invest.

Is the fund risky?

Except for certain capital preservation funds, investment funds have certain risks. The risk here actually means that the fund is different from bank deposits and national debt, which does not guarantee the capital preservation and promises the minimum income. Specific risks need to be classified.

Different types of funds have different risks, and the risk from high to low is: stock funds, partial stock funds, growth funds, index funds, hybrid funds, partial debt funds, bond funds, monetary funds and principal guaranteed fund.

Different types of funds have different risks, for example, stock funds are mainly the risk of stock market fluctuation, bond funds are mainly the risk of interest rate fluctuation and debt default, while monetary funds generally have relatively small risks if there is no financial systemic risk.

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