The bonds held by the Fund will generate interest income during the holding period, which is usually relatively stable. Different bonds have different credit ratings and different maturities, so their yields are different. The higher the credit rating, the lower the risk and the lower the coupon rate. In addition, the longer the term, the higher the coupon rate. Both bonds and bond funds will fluctuate because of the fluctuation of bond prices, which will lead to the fluctuation of bond value and fund net value, that is, there are gains and losses.

Extended information bonds are securities issued by debtors such as governments, enterprises and banks in accordance with legal procedures in order to raise funds and promise creditors to repay the principal and interest on a specified date.

Bond/debenture is a kind of financial contract, which is a debt certificate issued to investors when the government, financial institutions and industrial and commercial enterprises directly borrow money from the society and promise to pay interest at a certain interest rate and repay the principal according to the agreed terms. The essence of a bond is a certificate of debt, which has legal effect. There is a creditor-debtor relationship between bond buyers or investors and issuers. Bond issuers are debtors and investors (bond buyers) are creditors.

References:

Baidu encyclopedia-bonds