What are the characteristics of the fund's narrow base and wide base?
A wide range of basic functions:
1, with wide investment scope.
Broad base refers to an index fund with a wide trading range and a large trading coverage. Investment can cover multiple industries or sectors, that is to say, Kuanji can invest in funds of multiple industries or sectors at the same time. For example, the Shanghai and Shenzhen 300 Index and the CSI 500 Index. Therefore, the investment scope of Kuanji is relatively large.
2. Less risk
Because it invests in funds in multiple industries or sectors, it is equivalent to diversification, which well disperses investment risks and reduces risks.
3. Transparent operation
Kuanji is an index fund, which tracks the index of an investment target, and the income is related to the change of the index, so the operation is relatively transparent.
4. High investment efficiency.
At the same time, investing in the operation of multiple industries or sector funds has improved the capital utilization rate and investment efficiency of investors.
Narrow bottom features:
1, with small investment scope.
Narrow base refers to the index fund with relatively concentrated investment, which restricts the investment subject or industry and can only invest in one industry or sector at a time. Such as alcohol and tobacco, medical care, consumption and so on. Therefore, the investment scope of narrow base is relatively small.
2, the risk is greater.
Because it refers to a fund that can invest in an industry or sector, investors' income and investment risk are only related to this industry or sector, which is equivalent to investing all funds in the same fund, which magnifies the investment risk.
3. Transparent operation
Narrow base is an index fund, which only gains income according to the index change of investment target. Nor will it lead to decision-making mistakes because of the subjective views of fund managers.
Which is better, narrow bottom or wide bottom?
There is no specific comparison between narrow base and wide base. Investors can decide which type of fund to buy according to their actual situation and investment preferences.
1. If you are a novice ordinary investor, it is recommended to choose a wide base. Broad-based investors are not so demanding and suitable for long-term fixed investment. Narrow base requires high professional analysis of investors and is suitable for investors with certain experience and technical level.
2. Investors who pay attention to income suggest choosing a narrow base. The income of narrow base is higher than that of wide base, but the risk will be greater.
3. Investors who pay attention to stability suggest choosing a broad base. Wide-base dispersion has less risk and fluctuation, and is relatively stable, but the income may not be as high as narrow-base dispersion.