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Wide variety of fund names to explain in auto
insurance category

1. What is a growth fund, positive growth funds, growth
and income fund?

Major investment in capital and revenue growth is higher than the average corporate stocks, the
fund managers to emphasize that for the greatest capital appreciation rather
than dividend income, according to investment

Wide variety of fund names to explain in auto insurance category 1. What is a growth fund,
positive growth funds, growth and income fund?

Major investment in capital and revenue growth are higher than the average corporate
stocks, the fund managers to emphasize that for the greatest capital
appreciation rather than dividend income, according to investment and
entrepreneurial attitude, can be divided into “positive growth fund”, “growth
and income fund” and so on. For example, the “active growth fund” investment
objective is the pursuit of the principal amount of the largest growth,
dividends and interest income is not the focus of investments; but the “growth
and income fund” have to take into account the principal amount of the annual
distribution growth and interest rates, Therefore, choose placement of shares /
stocks with relatively high interest rates to invest.

This income of the Fund the best, but the average has the highest degree of risk. When the
general trend of decline, its decline over the possibility of a larger decline
in the market; and when the general trend bottomed out, its above-average rate
of increase also more likely. Therefore, these funds are risk-bearing capacity
mainly by investors in favor of a stronger, not suitable for those investors
are psychologically weak investors.

For example, in the Shenzhen Stock Exchange-listed fund, Yulon (4692)
is an active growth fund, a fund listed on the SSE Tongde (500,039) is a growth fund.

2. What is an income fund?

Its investment strategy is a unique value investment. The fund manager focuses on dividend
income, major investments in utilities, financial services and natural resource
industries with a generous dividend yield corporate stocks. In theory, such a
fund should be more stable than the overall market, using a method of low-risk
equity investments. Generally invest in bonds.

3. What is a balanced fund?

The types of funds are also concerned about not only concerned about the capital gains
dividend income, and even consider the future dividend growth, but are most
concerned about is the potential for capital appreciation. Such funds also
invest in growth stocks and a good record of dividend payment of income stocks,
the objective is to obtain dividend income, moderate capital appreciation and
capital preservation, so that relatively small investments to bear the risk in
the circumstances, it is possible to obtain a more a high return on investment.
Fluctuations in their net worth more stable, the gains and the corresponding
risks are between growth between investment funds and index-based. Therefore, a
balanced fund for those who do want to get a higher dividend income also hoped
that more stable than the growth fund investors seeking capital preservation as
the main auto insurance funds and pension funds, as well as those relatively
conservative individual investors.

Such as the Shanghai stock market
fund Hanxing (500,015), the Fund Tae (500,001) are all part of such funds.

4. What is an index fund?

Index Investing
is an attempt to fully replicate a stock price index or a stock price index
compiled in accordance with principles of building a portfolio of equity
investments carried out. By investment funds in this manner is called index
funds, the objective is to obtain roughly equivalent to the market’s average
return on investment.

Since the 90’s, the United States stock fund managers
on Wall Street, most of the performance was lower than the performance of
market indices over the same period, so in order to copy the market index
movement of the index funds as the core idea around the world to grow up
rapidly, and the traditional portfolio investment mind a tremendous impact and
challenges.

In theory,
index funds the operation of the method is simple, low-cost fund management,
simply choose a particular market index, according to composition of the index
securities in the index for each share to purchase the corresponding proportion
of the securities, long-term holding can. However, the market index is based on
prices of the securities at some point the mathematical treatment and get an
abstract target, while the index funds and not directly purchase index, but to
the actual market conditions, through the purchase of the corresponding
securities to achieve, due to transaction costs and poor time factor, the
performance of index funds do not track the index with it exactly the same,
there must be some differences, therefore, index funds also need to fund
managers and professional management.

For example,
the Shenzhen Stock Exchange-listed fund, Tianyuan
(4698), the Fund Pufeng (4693), etc., that is index
funds.

5. What is a
topic type (special type) funds?

Refers to a particular type of investment in shares or securities of
small and medium sized funds. One of the reasons
for the establishment of thematic funds because of restrictions by the size of
the Fund, and second, managers believe that certain types of securities with a
growth or value of particular investments.