Can you please help me explain what a bond fund is?

Fixed-income financial instruments such as treasury bonds and financial bonds are mainly invested, which are called bonds, because the returns of the products they invest in are relatively stable, and they are also called "fixed benefits". According to the different proportions of investment**, bond type ** can be divided into pure bond type** and partial bond type**. The difference between the two is that the pure debt type does not invest, while the partial debt type can invest a small amount.

The advantage of partial debt is that it can flexibly allocate assets according to market trends and share the opportunities brought by the market under the condition of controlling risks.

In general, there are no subscription or subscription fees for bonds** and the redemption rate is lower.

1.Bonds** refers to investing **assets in bonds, seeking more stable income through a portfolio of bonds. Bonds** are less risky due to their stable returns and lower risk, making them suitable for prudent investors who are not willing to take too much risk.

However, the bond is also affected by factors such as market interest rates, exchange rates, and the bond itself, and its volatility is lower than that of the bond.

2.How is it different from the type and money market.

The type is the one that takes the main investment object. Risk can be diversified to a certain extent through expert management and portfolio diversification. The risk of **type** is the highest among all ** products, which is suitable for the needs of investors with higher risk tolerance; Money market** only invests in money market instruments, and the net value of the share is always maintained at 1 yuan, which has the characteristics of low risk, low return, high liquidity, and low fees.

The money market** is known as a quasi-savings and can be used as a good alternative to bank deposits and a cash management tool; Bonds** mainly take various types of bonds as the main investment object, and the risk is higher than that of the money market** and lower than **type**. Bonds** obtain stable interest income through the investment of bonds such as treasury bonds and corporate bonds, which have the characteristics of low risk and stable income, and are suitable for prudent investors with low risk tolerance.

Bond** refers to fixed-income financial instruments such as treasury bonds and financial bonds as the main investment objects**.

Bond type refers to a type of bond in which most of the funds will be invested. It focuses on the way in which the bond portfolio is invested and seeks smoother yields. Bonds are proof of creditor's rights issued to debtors when departments, financial institutions, industry and commerce and other institutions raise funds directly from the society, and promise to pay interest and capital at maturity at a certain interest rate.

Bond performance** is affected by two main factors, interest rate and risk, i.e. the duration of the change in interest rate when investing in bonds. Then there is credit risk, when choosing a bond, you need to grasp its interest rate sensitivity and credit quality, and on this basis, you can grasp the risk level of the first and whether it meets the investment requirements.

In the face of a market downturn, the return on bonds also remains stable and will not be affected by the ups and downs of the sales market. Because the rate of return on bonds** investment commodities is stable, the corresponding ** rate of return is also stable. This article mainly writes about the relevant knowledge points of what is the meaning of bond **, and the content is for reference only.

What is a bond**? What does bond** mean?

Although bond type ** has been sought after by many investors because of its stability and income, there are still some investors who do not understand it and do not know what bond type is**? To that end, I've put together the following, come and check it out!

It is understood that the coincidental bond type can be referred to as bonds, simply put, it is a kind of investment in bonds, which mainly focuses on the funds of many investors to invest in bonds and seek more stable income. Bonds** are less risky than others**.

After understanding what is a bond**, let's take a look at how to choose a bond**:

1. Look at the pedigree: distinguish the direction of investment.

According to the different characteristics of bond investment, it can be divided into three types: pure debt base, primary debt base and secondary debt base. Of the three, the secondary bond base has the highest risk, but also the highest expected return; It is difficult to make a big breakthrough in the income of pure debt, but its income is stable and the risk is low. When choosing bonds**, you need to choose according to the direction in which they are invested.

2. Look at the cost: low transaction fees.

The cost of purchase will have an impact on revenue. In the case of ** not much difference, investors should try to choose a bond base with lower transaction costs. In addition, most of the old bond base has subscription and redemption fees, while most of the new bond base replaces subscription and redemption fees with sales service fees.

3. Look at the ranking: identify the benefits.

When choosing bonds, you can refer to the relevant rankings. At present, many **have**ranking**, and you can choose to buy ** that are relatively high in different periods. For example, before you buy, you can first look at the one-year performance ranking of bonds, and then select the good ones according to the ranking, and then look at their three-year rankings, and then select the top two time periods.

The difference between bond type** and bond

Bond is a kind of financial contract, which is issued to investors when financial institutions, industrial and commercial enterprises, etc. directly borrow from the society to raise funds, and at the same time promise to pay interest at a certain expected annualized interest rate and repay the principal according to the agreed conditions. The bond type is the first variety issued by the company that mainly invests in the bond market. The difference between bond** and bond is mainly reflected in the following aspects:

The expected annualized expected return of the bond type** is not as fixed as the interest of the bond;

Bonds** do not have a definite maturity date;

The expected annualized expected rate of return of a bond** is more difficult than the expected annualized expected rate of return of a single bond that is held to maturity**;

Bonds** can effectively avoid the higher credit risk that a single bond may face by diversifying their investments. In addition, because bonds** do not have a fixed maturity date, the expected annualized interest rate risk will generally remain at a certain level.

The role of bonds**

Bond type is the proportion of bond investment accounting for more than 80% of assets**, which is highly attractive to investors who pursue stable income. The volatility of bond type ** is usually less than that of **type**, so it is often considered by investors to be an investment tool with low to medium expected annualized expected return and medium to low risk. In addition, when the bond type and the ** type are appropriately combined with the investment, the investment risk can often be better diversified, so the bond type is often regarded as an indispensable and important part of the investment of the bank.

Bond** investment risk

Expected annualized interest rate risk. Bonds** are closely related to market expectations of annualized interest rate changes, and move in the opposite direction. The longer the average maturity date of the bond**, the higher the expected annualized interest rate risk of the bond**;

Credit Risk. Credit risk refers to the risk that a bond issuer will be able to pay interest on time and repay the principal at maturity. Some bond rating agencies will rate the credit rating of a bond.

If the credit rating of a bond declines, it will lead to the **** of the bond, and the net value of the bond will also decrease;

Early redemption risk. When the market expects the annualized interest rate to fall, the bond starter can be financed at a lower expected annualized interest rate, so the high-interest bond can be repaid in advance, and the bond with the right of early redemption will not only not be able to obtain the expected annualized return of the high interest rate, but also face the risk of reinvestment;

Inflation risk. Inflation eats away at the purchasing power formed by the fixed expected annualized expected return, so bond-type investors cannot ignore this risk and must buy some ** types at the right time.

According to the answer or proportion of investment**, bond** is divided into pure bond** and partial bond**.

The difference between the two is that pure debt does not invest, while partial debt can invest a small amount. The advantage of partial debt is that it can flexibly allocate assets according to the trend of the market and share the opportunities of the market under the condition of controlling risks. Generally speaking, there are no reservation and purchase fees for bonds**, and the repurchase rate is low.

Many bond-type ** pay income to the people every month, and the people can also choose to reinvest dividends to buy the income again.

There are four characteristics of the bond type**.

1.Low risk and low yield.

The investment object of bond**, that is, bonds, has stable returns and low risks, and the risk of bond-type basis funds is small. However, bonds are fixed income products, and the risk yield of bonds is not high compared to ****.

2.Low cost.

Bond** refers to fixed-income financial instruments such as treasury bonds and financial bonds as the main investment objects**, because the income of the products it invests in is relatively stable, and it is also known as "fixed income**". According to the different proportions of investment**, bond** can be divided into pure bond** and partial bond**.

Because the investment object of bond ** - bond income is stable and the risk is small, therefore, bond ** risk is small, but at the same time, because bond is a fixed income product, compared with ****, bond ** risk is low but the rate of return is not high. Bond investment management is not as complex as investment management, so the management fee of bonds is also relatively low. Investing in bonds has regular interest returns, and there is a commitment to repay principal and interest at maturity, so the income of bonds** is relatively stable.

Bonds mainly pursue a more fixed income in the current period, and lack of value-added potential compared to ****, which is more suitable for investors who are unwilling to take too many risks and seek stable income in the current period.

Investors can cash out bonds at any time when they buy bonds**, and they have good liquidity. Investors can redeem at any time based on the net asset value of ** units on the date of application, while investors who invest in bank fixed deposits and certificate treasury bonds will have difficulty in realizing them and will have to bear a high interest loss of early redemption. Compared with investors who directly invest in bonds, they can enjoy a variety of special treatment and obtain higher returns by purchasing bonds**.

For example, you can indirectly enter the bond issuance market and get more investment opportunities; Access to the interbank market to hold financial bonds with higher interest payments; You can enter the repurchase market and enjoy the treatment of super institutional investors with financing subscription of new shares and risk-free reverse repurchase interest income; **Cash assets are deposited in custodian banks, and the interest rate of interbank demand deposits is much higher than that of current deposits of residents and enterprises, including interest tax); Enjoy a variety of tax benefits. There is no need to pay stamp duty when subscribing and redeeming, and the dividends can also be exempted from income tax; You can also enjoy the low transaction costs of investing in bonds.

For ordinary bonds, the two basic elements are interest rate sensitivity and credit quality. The rise and fall of bonds** is inversely related to the rise and fall of interest rates. The creditworthiness of a bond** depends on the credit rating of the bond in which it invests.

Bonds** refers to the ** that specializes in investing in bonds, which seeks more stable returns by concentrating the funds of many investors to cover losses and invest in the bond Honghengshen.

Type refers to investing in the market. It can be divided into capital appreciation, growth, and income, and its main purpose is to pursue rapid capital growth, which has high risks and high returns.

These two ** are different in two main ways:

1.The investment target is different.

Bonds**The main investment targets are bonds. Including treasury bonds, financial bonds, corporate bonds, convertible bonds, etc.

The main investment target of **type** is **, and a small amount of funds will be allocated with short currency instruments to adjust ** and for people to redeem.

2.The stability of returns is different from the risk.

Compared with these two types of **, the stability of income and risk from high to low are: bonds**》****.

Bonds** use the net value method to calculate the daily net value of the unit, and the principal and interest must be repaid at maturity, the income is relatively stable and the volatility is small, but at the same time, the risk of the bond** is low, but the rate of return is not high.

Needless to say, because the market is extremely volatile, the income is extremely unstable, and depending on the market and operational ability, losses may occur at any time, so the risk is greater.

Finally, there are two fees for subscription and redemption of bonds. However, due to the different investment years and companies, the subscription and redemption fees of each ** are different, and some **** companies will have handling fee discounts, and the specific subscription and redemption fees can be consulted with ** company at the time of purchase.

1. What is a bond**?

First, let's take a look at what a bond is.

A bond is a voucher for borrowing money, and in layman's terms, it is an "IOU".

For example, Xiao Wang borrowed 30,000 yuan from you, and you gave Xiao Wang an IOU, agreeing to a certain interest and repaying the money after one year, which is a debt relationship between individuals.

And if the state borrows money from you and gives you a kind of debt certificate, it can be called a national debt.

Because the country's credit is the best, you take very little risk, so the benefits you can get are not too high.

However, the IOU between you and Xiao Wang can only be used between you, and cannot be used for circulation between individuals, enterprises, and banks.

Treasury bonds, enterprise bonds, financial bonds, etc., because they are standardized IOUs issued in accordance with the standard format required by the state and approved by various state departments, can be circulated in the market.

For example, if you take a CDB bond to the bank to pay off the debt, the bank will accept it.

Therefore, the definition of bond is a creditor's right and debt certificate issued to investors when financial institutions, industrial and commercial enterprises and other institutions directly borrow from the society to raise funds, and promise to pay interest at a certain interest rate and repay the principal according to the agreed conditions.

At the same time, borrowers, such as ****, local **, financial institutions, listed companies, enterprises, etc., different borrowers, because the credit rating is different, the borrowing interest rate is high and low.

So, how should bonds** be understood?

Bonds, also known as bonds, refer to those that invest in bonds, which seek more stable returns by pooling the funds of many investors to invest in bonds in a portfolio. Bonds** can also have a small part of the funds invested in the **market**, in addition, investing in convertible bonds and new shares is also an important channel for bonds** to obtain income.

Bonds provide investors with fixed returns and repayment of principal at maturity, with lower risk than **, and bonds have relatively low risk and relatively stable income fluctuations, which is an indispensable part of asset allocation.

2. Classification of bonds**.

According to different investment directions, the current domestic bonds** can be divided into three categories:

1. Standard bond type**, that is, pure debt** (can be subdivided into short-term debt**, credit bond**).

2. Ordinary bond type** (can be subdivided into primary debt base and secondary debt base).

3. Other strategic bonds** (such as convertible bonds**).

Next, let's talk about pure bonds**, hybrid bonds**, and convertible bonds**.

Next, let's talk about pure bonds**, hybrid bonds**, and convertible bonds**.

1. Pure debt**.

Pure debt**, only invest in the bond market, do not participate in new stocks, and do not invest**, among the four types of bonds**, the risk is the smallest.

This type of debt base is relatively easy to identify, and generally carries the word "pure debt".

For example, GF Pure Bond A (270048).

According to the length of the average maturity of investment bonds, it can be divided into:

Medium and long-term bonds**;

Short-term bonds**.

However, no matter which one it is, it only invests in bonds, and in the past, most of the A-shares were medium and long-term bonds, and the number of short-term bonds was actually very small