In this article, LTG GoldRock will share with you what are the advantages and disadvantages of the fund ~
Advantages of the fund:
1. The collection investment fund is such an investment method: he cleverly gathered scattered funds and handed over to professional institutions to invest in various financial instruments to seek value -added assets.
2. Disted risk funds can achieve diversification of asset portfolios and decentralized investment in multiple securities.Through diversified operations, on the one hand, with the help of huge funds and the advantages of investors, the investment risk faced by each investor will become smaller.Essence
3. The expert management fund implements the expert management system. These professional managers have been specially trained and have rich experience in securities investment and other project investment.
Second, the disadvantages of the fund:
The disadvantages of the fund are mainly risks, and the risks are mainly from:
1. Credit risks: Including the credit risk of tools such as bonds and notes invested by the fund, as well as home risks based on transactions, such as repurchase agreements, such as repurchase agreements.
2. Risk of market price exposure: The risk of market price exposure refers to the actual market value of the currency market fund, that is, the desertation risk of the net value of the fund and the fund transaction price (usually the fund face value) is expected to be expected to be expected to be expected by the market price law.
3. Policy risk: The changes in macro policies such as fiscal policy, monetary policy, industrial policy, and regional development policy have caused market price fluctuations and affecting fund income.
4. Economic cyclical risk: With the periodic changes of economic operation, the level of income of the securities market also changes periodic changes, and the level of fund investment will also change accordingly, thereby generating risks.
5. Interest rate risk: The fluctuation of financial market interest rates will lead to changes in the market price and yield of securities market.Interest rates directly affect the price and return of bonds, and affect the financing costs and profits of the enterprise.Fund invests in bonds and stocks, and its income level may be affected by changes in interest rates.
6. The operating risk of listed companies: The operating conditions of listed companies are affected by many factors, such as management capabilities, industry competition, market prospects, technical updates, financial conditions, new product research and development, etc., will cause the company's profitability.If the listed company invested in the fund is poorly operated, its stock price may fall, or the profitable profits that can be used for distribution will reduce the income of fund investment.Listed companies may also have unpredictable changes.Although the fund can disperse this non -systemic risk by investing diversification, it cannot be completely avoided.
7. Inflation risk: The purpose of fund investment is the value preservation and appreciation of fund assets. If inflation occurs, the income obtained by the fund's investment may be offset by inflation, which will affect the value -added value of fund assets.
8. Risk of changes in bond yield curves: The risk of changes in the bond yield curve refers to the risk related to the non -parallel movement of the yield curve. A single long -term index cannot fully reflect the existence of this risk.
9. Reinstance risk: The decline in market interest rates will affect the reinvestment yield of interest income of fixed income securities, which will grow with the price risk brought about by rising interest rates.
10. Credit risk: The fund may have a breach of contract or the issuer of the investment bonds during the transaction process, which breaks the contract, and refuses to pay the principal and interest, which leads to the loss of the fund assets.
11. Management risk: Fund managers' professional skills, research capabilities and investment management levels directly affect their possession, analysis, and judgment of the economic situation and securities price trend, which will affect the fund's investment income level.At the same time, whether the fund manager's investment management system, risk management and internal control system are sound, whether it can effectively prevent moral risks and other compliance risks, and the level of professional ethics of the fund manager will also be onCauses impact.
12. Risk of liquidity: As an emerging transit market, my country's securities market is high.Stocks and bonds in the fund investment portfolio will face high liquidity risks for various reasons, which will increase the difficulty of implementation of securities transactions, and increase the cost of buying or monetization.In addition, fund investors' redemption demand may cause fund position adjustment and difficulty in asset monetization, exacerbating liquidity risks.
13. Operation and technical risks: During the operation of various business links, related parties to the fund may cause risks due to inadequate control or human factors or operating errors or violating operating procedures, suchFraud and so on.In addition, in the background operation of open funds, the normal progress of transactions may be affected due to faults or errors in the technical system or even caused the interests of fund share holders.This technical risk may come from fund managers, fund custodians, registered registered people, sales agencies, stock exchanges, and securities registration and settlement institutions.
