I. Introduction to Fixed Income Funds
Disclaimer: This article is only a reflection and staged review in the process of personal investment. I am just an ordinary person. The opinions of the article are not necessarily correct, and the investment level is also very general. The stocks or funds involved in the article may have the risk of falling sharply. , please maintain independent thinking, the market has risks, and investment needs to be cautious. The opinions of the article are only for communication and do not constitute any investment advice. Readers and friends should not act accordingly!
In the fund series articles, we have evaluated and analyzed active funds and index-enhanced funds. In this article, we will analyze fixed income funds. Fixed income funds are also a very important type of subdivided fund, especially for those who prefer a stable investment style. It is very suitable for people.
At present, there are many types of funds in the fund market, and there are many names for the division methods of various funds, but I still prefer to divide them according to the underlying assets. No matter what form of shell is put on, as long as you can grasp the attributes of the underlying assets To understand the risk and return characteristics of funds, the following is a simple division of common funds in the market based on the underlying assets:
The protagonist of this article “fixed income fund” mainly refers to the “secondary hybrid bond base” or “fixed income +” in the bond fund. The underlying assets are mainly bonds. In addition to cash equivalents, the remaining positions generally have No more than 20% of the secondary market stocks, and this part of the secondary market stock positions can also be renewed. Compared with pure bond funds, “secondary hybrid bond funds” or “fixed income +” are more aggressive Some of them obtain long-term expected returns that exceed pure bond funds by holding a small number of stocks. At the same time, because of certain holdings of stocks, the retracement and volatility are larger than those of pure bond funds.
The main advantages of fixed income funds are as follows:
a. Higher return expectations compared to pure bond funds
Because a small amount of stock positions have been added to fixed income funds, from the perspective of major asset classes, long-term investment in stocks faces greater volatility, but the potential return of investing in stocks is also higher. Let’s take a look at the fixed income funds evaluated in this article. One of the members: Huatai Bai Rui Dingli Mixed A (F004010) and the net value curve comparison of a pure debt fund we wrote before: Wells Fargo Credit Bond A (F000191):
It can be seen that due to the market downturn in the past two years, the fixed income fund Huatai Pineapple Dingli Hybrid A (F004010) and the pure bond fund Wells Fargo Credit Bond A (F000191) both outperformed the CSI 300 Index, but from nearly 5%. From the net worth curve of the year, the fixed income fund representative: Huatai Pineapple Dingli Mixed A (F004010) still outperformed the pure debt fund representative Wells Fargo credit bond bond A (F000191), and while achieving excess returns, from the net worth curve The volatility and drawdown angle are not much larger than those of pure bond funds, and the performance is still very good.
b. Compared with stock funds, the drawdown is lower, and the experience of holding the base is better
Compared with stock funds, fixed income funds generally have lower long-term yields than stock funds because most of their assets are bonds, but there are always positive and negative sides. Safety pad, the retracement of fixed income funds is much better than that of stock funds. Let’s take a look at the fixed income fund Huatai Pineapple Dingli Mixed A (F004010) and a CSI 300 Index Enhancement Fund we wrote before: China AMC CSI 300 Index Enhanced A (F001015), it can be seen that due to the market downturn in the past two years, the valuation of the CSI 300 Index has reached the historical bottom area, so even if the China AMC CSI 300 Index Enhanced A (F001015) has outperformed in the past 5 years The CSI 300 Index, but the fixed income fund Huatai Pineapple Dingli Hybrid A (F004010) also outperformed the Huaxia CSI 300 Index Enhanced A (F001015) by relying on high-position bonds, but the stock market is currently at the bottom as a whole. The yield of stock funds is still higher, but from the perspective of the drawdown of the net value curve, the drawdown of fixed income funds is much smaller, and the experience of holding the fund will be very good.
c. In the mid-line cycle, it can be used as an ammunition warehouse in conjunction with index fixed casting
Many fund investors have made fixed investment in index funds. Investors who are familiar with fixed investment in index funds will find that there will be a phenomenon of “passivation of fixed investment” in the later stage of fixed investment. As far as ammo compartments are concerned, I personally tend to configure two:
Short-term ammunition warehouse: pure debt fund (30%-40% of the allocation of ammunition warehouse)
Mid-line cycle ammunition warehouse: fixed income fund (60%-70% of the configuration ammunition warehouse)
When the market falls sharply, the underlying valuation is at the bottom, and index investment usually requires a large investment. At this time, a short-cycle ammunition warehouse can be used first: pure debt funds, because fixed income funds have a certain position in stocks, it is inevitable that they will also There is a certain retracement. After the market rebounds steadily, the short-cycle ammunition warehouse: pure debt fund is supplemented by the mid-line cycle ammunition warehouse: fixed income fund;
d. It is a ready-made feasible asset allocation plan for financial management novice
Some financial novice may not have much money, are busy with work every day, and do not have much time to learn about fund investment. At this time, the underlying asset design of fixed income funds (most bonds + a small part of stocks) is already a ready-made viable asset. The allocation plan is ready, and the rate of return is not bad (one of the members of the fixed income fund in this article: Huatai Bai Rui Dingli Mixed A, established for 5 years and 315 days, the rate of return is 70.14%, equivalent to an annualized rate of return of 9.5%, the performance is still good, The general fixed income fund has a long-term annualized rate of about 6%-8%), the net worth curve has a small retracement, and it takes almost no time to take care of it, and the experience of holding the fund will be better;
2. Hard-core evaluation of fixed income funds
In this article, we compare the fixed income funds on the market: Huaxia Ruipan Taili Mixed A (F005177), Huatai Bai Rui Dingli Mixed A (F004010), Anxin New Target Mixed A (F003030), Invesco Yield Return A ( F002792), Bank of Communications Hengyi Flexible Configuration Mixed A (F004975), China Life An Bao Wencheng Mixed A (F004225), Cathay Minyi Flexible Mixed A (F160220), Qianhai Kaiyuan Yuhe Mixed A (F004218), Huabao New Value Hybrid (F001324), Harvest Strategy Optimal Hybrid (F001756)
1. Fixed income fund NAV curve and rating:
It can be seen that the fixed income funds in this evaluation have outperformed the CSI 300 Index in the past five years, but the main reason is that the valuation of the CSI 300 Index has been pressed to the bottom, and the market is still at the bottom. Among the fixed income funds, Huatai Pineapple Dingli Mixed A (F004010) performed the best, and the performance of several other fixed income funds was not large enough. The overall rating of 4 stars is also the highest, and the ratings of Essence New Target Mixed A (F003030) and Huabao New Value Mixed (F001324) are also higher.
2. Annualized rate of return of fixed income fund range:
It can be seen from the perspective of the annualized rate of return in the past 5 years, Huatai Bai Rui Dingli Mixed A (F004010) performed the best, with an annualized rate of return of 9.89%, followed by Anxin New Target Mixed A (F003030), Huatai Baoxin Value Mix (F001324) and Harvest Strategy Optimal Mix (F001756) also achieved an annualized rate of return of 7%+.
3. Fixed income fund excess return assessment:
The indicators for evaluating the excess return of a fund are generally the Sharpe ratio and the Sodino ratio. I personally pay more attention to the Sodino ratio. Some children’s shoes may not know the Sharpe ratio and the Sodino ratio. Here is a brief introduction:
Sharpe Ratio: Sharpe Ratio = (Annualized Return – Risk Free Rate) / Portfolio Annualized Volatility = Excess Return / Annualized Volatility
The Sharpe ratio itself has no meaning in size, it is only valuable in comparison with other combinations
Sodino Ratio: It is similar to the Sharpe ratio, except that instead of standard deviation, it uses downside deviation, that is, the degree to which a portfolio deviates from its average decline, to distinguish between good and bad volatility. Therefore, when calculating volatility It uses not the standard deviation, but the descending standard deviation
It can be seen that Huatai Bai Rui Dingli Mixed A (F004010) is still the best, with the highest Sodinor ratio of 2.4, Anxin New Target Mixed A (F003030), and Sodinor 2.16 ranked second, Huabao New Value Mixed (F001324), Harvest Strategy Optimal Mix (F001756), Huaxia Repan Taili Mix A (F005177) also had higher Sodino ratio;
4. Fixed income fund stock positions:
The stock positions of several fixed-income funds evaluated in this article are basically between 10% and 20%, except for Invesco Shunyi Return A (F002792) stock position of 22.33%, Qianhai Kaiyuan Yuhe Mixed A (F004218) stock position of 23.17% More than 20%, these two fixed income funds have underperformed other fixed income funds in the sluggish market in the past two years because of their higher stock positions, which also reflects the two sides of things.
5. Fixed income fund holder structure:
Compared with other fixed income funds, Huatai Pineapple Dingli Hybrid A (F004010), which performed better in this evaluation, has a lower proportion of institutional holdings. “It’s not completely absolute, it just means that the institution’s investment and research capabilities are stronger, and the fund that the institution looks at will probably not be of poor quality, but it can’t be rude.
6. Strength of fund companies affiliated to fixed income funds:
Compared with stocks, for bond investment, the investment and research strength of institutions will play a greater role. Therefore, for fixed-income funds, the stronger the investment and research strength of fund companies, the better the performance of fixed-income funds. Yes, for fund companies, the scale of assets under management is a very important indicator. After all, the larger the scale of assets under management, the more management fees it will receive. The more management fees, the more money to recruit more outstanding asset management talents. , the fund companies where several fixed income funds evaluated in this article are still ranked high in assets under management, especially the China Asset Management Fund, where Huaxia Ruipan Taili Mixed A (F005177) is located, ranks fifth in assets under management, and its strength is still relatively strong .
Finally to sum up:
The main advantages of fixed income funds are as follows:
a. Higher return expectations compared to pure bond funds
b. Compared with stock funds, the drawdown is lower, and the experience of holding the base is better
c. In the mid-line cycle, it can be used as an ammunition warehouse in conjunction with index fixed casting
d. It is a ready-made feasible asset allocation plan for financial management novice
The overall performance of the fixed income funds evaluated in this article is not bad. Among them, Huatai Pineapple Dingli Mixed A (F004010), Anxin New Target Mixed A (F003030), Huabao New Value Mixed (F001324), Harvest Strategy Preferred Mixed (F001756), The comprehensive performance of Huaxia Ruipan Taili Hybrid A (F005177) is better. Fixed income funds obtain excess returns relative to pure bond funds by allocating a small amount of stock positions, and the drawdown and volatility are much smaller than that of stock funds. , you don’t need to spend too much energy to take care of it, and the long-term annualized rate of return is not bad (usually about 6%-8%). For those who like index fixed investment, it can also be used as an ammunition warehouse in the mid-line cycle. Fixed income funds are used as a kind of Important subdivided fund categories have many advantages and are worthy of being included in the competence circle to strengthen research, and are the preferred fund category for stable investment .
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$ Huatai Bai Rui Dingli Mix A (F004010)$ $ Anxin New Target Mix A (F003030)$ $ Huabao New Value Mix (F001324)$
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