Why is the return of a large portfolio bond trust lower than that of a group bond?
We have said before that portfolio bond trusts are mainly divided into three categories, including single bond trusts, small portfolio bond trusts and large portfolio bond trusts. However, the trust income of large portfolio bonds will be lower than that of small portfolio bonds, and at this time, some customers will have questions, why can the income of single bonds or small portfolio bonds be given to about 6%? And what about the return of large portfolio bonds generally less than 5%? Aren't they all the same urban investment bonds at the bottom?
It is understandable for investors to have this question, but we need to know that if you want to find more than 100 bonds in the whole market, the cost is about 6% or 7%, which is very difficult. Because there are few bonds, and the cost is different in different regions. And in addition to trust companies buying, banks, insurance companies and other financial institutions are rushing to invest in bonds. Even if you can find it, it's almost always bonds that are concentrated in those few high-risk areas, which doesn't help diversify risk.
Moreover, the maturity of large portfolio bonds is generally short and long, and the liquidity requirements are very high. There are many companies that will buy large sums of money for this kind of products, such as a lump sum, which is tens of millions or hundreds of millions. Once there is such a large redemption, the ** manager must ensure that the bonds in hand can be sold quickly in the bond market, which also requires that the bonds in hand should not be too bad, and they should be sold when they want to sell.
Of course, the returns of bonds in high-quality areas will not be very high, which is why the returns of large and small portfolio bonds are different. And the risks of the two of them are also different, which is actually easier to understand, because the more dispersed the bottom, the higher the security is theoretically.
If an investor buys just one bond, if something goes wrong, the money will all go wrong. If an investor buys 100 bonds, there is a problem, that is, only 1%, which may not affect the overall return of the investor. Therefore, the return of large portfolio bond trusts will be a little lower, but they have certain advantages in structure, of course, this premise is that their underlying assets cannot have a large number of bonds in high-risk areas, otherwise the risk will be relatively large.
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