GUANGZHOU (Fund China) - The equity funds became a limelight in the past two years bullish market which covered the bond fund with a lower risk and a lower yield performance. But bond funds investd in the new shares IPO stepped on the stage for the weekly yield champion in the last quarter 2007.

As worries for 2008 market condition spread out, protecting the acquired earning became some people’s main investment aim this year and they are considering to invest into bond and abandon some equity funds holdings.

Bond funds’ approval

When the first approval was consigned to bonds funds, despite the A share warms up gain, the equity funds issues are stilll not eased expect some closed-end to open-end funds.

Following the UBS SDIC sustaining profit increase bond fund issued succesfully, a new bond fund will float last week. Guangfa enhanced bond fund, the eighth funds of Guangfa fund management, has gain the approval and will issue recently. This is the second new fund gained approval this year and also it is a bond funds that can be invested in the new shares IPO.

As recently as the new fund issue reopen from the last quarter 2007, the repon approval was consigned to the bond funds mostly. And the bond funds perfect performance in the continual turbulence in 2007 also attracted some investors eyes.

choose the new share IPO investment in Strong market as in weak market choose bond funds, the new share IPO investment and bonds’ combination will be the mainstream strategy for bond funds. So it is in the new approved bond funds issued recently.

Choose the bond fund with in the new share IPO investment

“Recently, a number of clients want to transfer some equity funds into bond funds for risk prevention” Jingzhiyi, the CITIC Bank Hangzhou Fengqi branch financial manager said, “some customers choose to draw out a part of principal for bond funds,and the profit earned these two years then was left in equity funds.

Due to the uncertainty in the market this year, some investors begin to pay attentino to bond funds. And there are also some investors pick up the bond funds for their long term investment porfolio besides the mentioned investors for short term risk prevention.

It is worth mentioning that, last year, due to the owning of new share IPO invsetment, the bond funds beat the equity funds down in the new share issuing rush-hour.

Relevant statistical data showed that the bond fund average yield reached 23.56% 2007, 7.4 percent point higher than that of 2006. some eye-catching bond funds even gained a annual return rate of 40% around.

Lower risk but better yield are the main facotrs catching investors

attention for bond funds. GuoJian, the wealth management general manger in Shanghai Pudong Development Bank Hangzho branch recommended investors to pick up a 20% more or less bond fund porfolio while investing in equity funds mainly for risk diversification.

Copyright Fund China 2008.

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