Bond funds, also known as bond funds, refer to funds that specialize in investing in bonds. By concentrating the funds of many investors, we can make portfolio investment in bonds and seek relatively stable returns. In China, bond funds mainly invest in government bonds, financial bonds and corporate bonds. Usually, bonds provide investors with a fixed return and repay the principal at maturity, and the risk is lower than that of stocks. Therefore, compared with stock funds, bond funds have the characteristics of stable income and low risk. When choosing a bond fund, we must understand its interest rate sensitivity and credit quality. On this basis, you can know how high the risk of the fund is and whether it meets your investment needs.

Advantages of bond funds:

Ordinary investors can easily participate in inter-bank bonds, corporate bonds, convertible bonds and other products. These products have various inconvenient restrictions on small funds, and buying bond funds can break through this restriction.

When the stock market is in a downturn, the income of bond funds is still very stable and is not affected by market fluctuations. Because the product income invested by bond funds is very stable, the corresponding fund income is also very stable. Of course, this also determines that its income is subject to the interest rate of bonds and will not be too high. At present, the annual interest rate of corporate bonds is around 4.5%, and the annual rate of return can be guaranteed to be between 3.3% and 3.5% after deducting the fund operating expenses.

Disadvantages of bond funds:

Only by holding it for a long time can we get a relatively satisfactory return.

When the stock market soared, the income remained stable at the average level, which was lower than that of equity funds. When the bond market fluctuates, there is even the risk of loss.