The types of open-end funds
GUANGZHOU (Fund China) – There are many kinds of open-end funds. However, they can be divided into four kinds according to their targets, objects and strategies. First is the equity fund. This kind of fund mainly invests in stocks with high risk and high revenue. Second is the mixed fund. This kind of fund invests dispersedly in stocks, bonds and money market. Third is the bond fund. This kind of fund mainly invest in bonds .Its purpose is to have a fixed revenue. So, its risk and revenue are much lower than equity funds. Fourth is the money market fund. This kind of fund only invests in money market. So, its revenue is stable and the risk is very low.
Before investing in open-end funds, investors should know their tolerance for risk and then select the right fund. Those who prefer stable revenue to risk should select money market funds or bond funds. Those who want higher revenue and can tolerate some risk should choose mixed funds.
Copyright Fund China 2009.
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