Pure debt funds refer to pure bond funds, that is, the targets of such funds are all bonds, such as government bonds, government bonds and local bonds. Because the investment target is very safe, the security of pure debt funds is also very good.

Is the pure debt fund guaranteed?

Pure debt funds are not guaranteed, and there is a possibility of loss, but the probability is very small. After all, there are fluctuations and ups and downs in the bond market. When the market adjusts, bonds will also have a corresponding callback, and it is impossible for pure debt funds to protect their capital. For example, the market bond market you bought is very stable and the income is good. When you sell, the bond market fluctuates, so you may lose money.

Reasons for loss of pure debt fund:

1 The bonds held cannot be repaid at maturity, which will result in the loss of principal.

The fluctuation of bond value caused by the change of interest rate during the bond holding period will also cause losses if it is not handled properly.

3 The relative decline in bond prices and the unreasonable allocation of the underlying bonds during the holding period may lead to the impairment of the fair value of bonds, which is reflected in the loss and net value reduction in the current financial statements.

Although the pure debt fund does not guarantee the principal, the probability of loss is very small. Moreover, pure debt funds have another advantage, that is, they have income on weekends and legal holidays, because the interest on bonds they invest is calculated according to 360 days a year, which will generate interest income. Therefore, pure debt funds are profitable on weekends, but they are not displayed, but will be displayed together on Monday, so many people find that their pure debt funds have increased a lot on Monday.

Contrary to the stock market, the bond market is a bull market, with long bear market and short bear market. From the perspective of income and long-term, pure debt income can cover the cost of financial management. It is recommended to hold pure debt funds for a long time, and give priority to funds held by stable fund managers when choosing.

The risk level of pure debt funds is mostly medium and low risk, which is suitable for investors with stable risk preference. However, there is a risk of principal loss, which mainly comes from bond default risk and market interest rate risk.