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The booming bond market this year is obvious to all. Seeing the encouraging performance of bond funds, many friends are also thinking of seizing the opportunity to keep up with the trend and plan to increase their holdings of bond funds.

But let’s be honest, although bond funds have performed steadily, you can’t just buy them blindly. Buying bond funds is just like buying equity funds. You need to do a good investigation in the early stage to have a better investment experience.

Well, today, we will teach you a set of “three views” to help you do the “background check” of bond funds.

First look: look at your investment needs

We have repeatedly stressed in the past that there is no best fund in the market, only the fund that suits you best. Before selecting a bond fund, we need to first clarify our expected returns and the range of drawdown we can tolerate, and use risk tolerance as a starting point to initially include risk-adapted bond funds into the fund pool to prevent subsequent investments from being troubled by risk mismatch.

At the same time, the use period of the funds should be clearly defined, mainly to match the investment period. For example, if a sum of money is to be used in the short term, it may be more suitable to invest in a medium- and short-term bond fund with lower risk and no holding period. On the one hand, the income is more stable, and on the other hand, it can avoid the situation where the money cannot be withdrawn when it is urgently needed; and for the idle money that is not used for a long time, some long-term bond funds or "fixed income +" funds with greater yield elasticity can be considered. A more relaxed fund use period can help us face short-term fluctuations more calmly.

Second look: look at the basic situation of the bond fund