What Is an Active Index Fund?

Active funds are classified according to the different investment concepts of stock funds: general active funds are a fund that seeks to achieve performance that exceeds the market.

Active fund

Right!

Active

Funds are divided into stock funds, bond funds, hybrid funds, and money market funds according to different investment objects. Equity funds refer to funds that invest more than 80% of their assets in stocks, such as Huitianfu Advantage Selection. Bond funds refer to funds that invest more than 80% of their assets in bonds, such as Huaxia Bonds.

A hybrid fund refers to a fund whose proportion of stock investment and bond investment does not meet the requirements of stock funds and bond funds, such as the Harvest theme selection. Money market funds refer to funds that invest only in money market instruments, such as Fortis Currency.

According to different investment concepts, funds can be divided into active funds and passive (index) funds. Active funds are a type of funds that strive to achieve performance beyond the benchmark portfolio. Unlike active funds, passive funds do not actively seek to outperform the market, but try to replicate the performance of the index. Passive funds generally select specific indexes as tracking objects, so they are often called index funds.

Index funds can be divided into two types. One is a pure index fund. Its assets are almost completely invested in the constituents of the tracked index. It is almost always full, even if the market can clearly see that it will continue to fall in the next half year. It also maintains a full position without making positive market judgments.

Another type of index fund is an index-enhanced fund. This kind of fund is based on purely indexed investment and makes appropriate adjustments based on the specific conditions of the stock market.