Investment tips from entry to mastery of fund investments

The first section buys funds as needed

Learn about the fund's variety before buying a fund

The initial investment fund friends, often a see a variety of fund leaflets, and newspapers in various funds introduction and classification, the brain dizzy, no direction. Even with the ratings of Morningstar, Citic and other rating agencies, it is not clear which one of these funds should be the best one to buy.

In fact, the first step in choosing a fund is to understand the type of fund and then talk about the choice of one or more funds to build your own portfolio. There are many kinds of funds, which can be divided into different types according to whether they are open, strategic, or standard. Investors are free to choose according to their own risk attributes. Here, we give you a detailed introduction of the types of funds.

Open and closed-end funds. The fund has open and closed points. For open-end funds, investors can buy, redeem, or convert directly to the fund company at any time based on the net value of the fund, without the need for a centralised market matchmaking (except Lof and EFT). Open-end funds have only one net price per day, and buying and redemption are carried out in accordance with the net value without a discount. After the stock market closes, the fund company calculates the net value of the day. The size of the fund increases as investors buy and sell. Closed-end funds, is the issue of a fixed number of shares, the expiry of the fund to raise the expected scale, that is, no longer accept investors to buy or sell, it is called closed-end funds. After the foundation is listed on the stock Exchange, all trading transactions of the investor need to be made through a centralized market, the same transaction process as the trading of shares, must be traded through a securities brokerage. The price of the sale, the probability of the deal are determined by market supply and demand. As a result, closed-end funds have two quotations per day: One is the market price of the central markets and the other is the net value of the fund's daily calculations.

According to the investment strategy, the fund can be divided into the following categories, the risk of decreasing: 1, the positive Growth Fund: to pursue the largest value-added capital for the operational objectives, usually invested in a large price volatility of the stock, the choice of stock indicators are often the growth of earnings per share, sales growth and other data, the most adventurous enterprising characteristics Suitable for risk-taking investors. 2, Growth type: In pursuit of long-term stable value-added for the purpose of investment subject to long-term capital growth potential, good quality, high visibility of large-scale performance of the company's stock. 3, Value type: In order to pursue the price is underestimated, the low earnings ratio of the stock as the main strategy, hoping to find those temporarily neglected by the market, the price is lower than the value of the stock. 4: Balanced fund: To take into account long-term capital and stable income as the goal. Usually there is a certain proportion of funds invested in fixed income tools, such as bonds, convertible corporate debt, to obtain stable interest income, control risk, the other part of the investment in equities in pursuit of capital gains. Moderate risk/reward, suitable for prudent and conservative investors. 5, Capital Preservation Fund: to protect investment capital as the goal, combined with low-risk income-based financial instruments and more risky stocks. The way to do this is to invest some of the money in low-risk instruments such as Treasuries, some of which are invested in equities, while part of the share may be determined by the net value of the fund, the higher the equity, the higher the portion of the stock that can be invested in. At home, capital-protected funds are generally guaranteed by third parties. In foreign countries, because of the ability to invest in derivative instruments, the higher risk investment portion of the Capital Preservation Fund can also be invested in derivative instruments by investing the interest in the bonds, and pursuing the profit by amplifying the lever operation. However, to remind investors that the capital-protected funds are not redeemed at any time can be guaranteed, redemption before the expiry of the capital preservation period, may also face the risk of principal loss.