About Bond Fund and Money Market Fund – Loan Finance and Money
Buying shares in bond funds is an alternative to buying bonds yourself. Similarly to a mutual fund, you will be ensured that professional investors manage your money. The risk of loss is thus reduced. Bond funds will also be able to invest in more bonds than you can as a widow, which also contributes to reduced risk. As an investor in a bond fund, you will receive a return from interest on the bonds and from any exchange rate gains.
Read this about bond funds and money market funds and some financial tips on this.
The exchange rate changes in bonds in which the funds invest change the value of units in the bond funds. The tax rules for units in bond funds and bonds are the same.
Shares in bond funds can be purchased in the banks’ fund departments, or directly in the bond funds.
Money market funds invest funds in interest-bearing securities with a maturity of up to one year. As an investor, you get a return from the interest income from the securities. Use the banks’ interest rates on the high-interest account as a comparison when considering the returns from the money market funds.
Combination Fund combines investment in equities and interest-bearing securities.
Combination funds ensure a certain return from interest on bonds, while investing in shares offers the opportunity for share price gains (and losses).
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