From the perspective of investment direction, there are mainly three categories. The three most commonly used funds are currency funds , bond funds and stock funds.
The first category is currency funds, which are the most common type. For example, Yu’e Bao bought by many friends is also a monetary fund. This kind of money fund is relatively safe and has good liquidity, but the relative return is relatively low. It is mainly used in place of cash.
The second is a bond fund , which mainly invests in some bonds. The yield of bond funds is higher than that of currency funds, but the risks are also higher. For example, investing in money funds will not suffer losses, but investing in bond funds may suffer small losses in the short term.
The third category is stock funds. As the name suggests, it is a fund that invests primarily in stocks. Among the three types of funds, equity funds are the most risky . For example, in the stock market disaster of 2015, the domestic stock market fell sharply. If you enter the market at a high point, you will not only make no money, but also lose a lot. However, while the risk is high, the long-term return of the equity fund is the highest of the three funds.