Which is better, private equity fund or Public Offering of Fund?

Our usual investment funds are purchased from some fund direct sales or consignment platforms, such as banks, Alipay, Tian Tian Fund Network and other fund products are actually publicly issued funds. In addition to Public Offering of Fund, there are actually relatively rare private equity funds.

Which is better, private equity fund or Public Offering of Fund?

There is no clear answer as to which is better, private equity fund or Public Offering of Fund. Can't compare directly. They have different investment logics and can be configured when necessary, as long as we give full play to their advantages.

Let me talk about the specific investment logic of the two.

1 flexibility of funds

Private equity funds generally have a share lock-up period of 3 months, 6 months, 1 year, 2 years and 3 years. You can't redeem it during the lock-up period, but you can only redeem it on the open day. Generally speaking, they are open 1 time a month.

Public Offering of Fund is generally flexible, and most of them have no lock-up period, so they can apply for redemption every day.

So long-term idle funds can be used to invest in private equity funds. For the funds that may be used in the short term in the future, or those that are not sure whether they will be used, you can invest in Public Offering of Fund.

2 overall profitability

Under normal circumstances, the overall rate of return of private equity funds will be slightly higher than that of Public Offering of Fund.

This is because of the entry threshold for private equity funds. Moreover, according to the relevant laws and regulations, the amount of individual investors investing in a private equity fund is not less than 6.5438+0 million, and then the financial assets of individual investors are not less than 3 million, or the average annual income in the last three years is not less than 500,000.

On the other hand, the capital invested by private equity funds will have a long lock-up period, so they can make long-term investments and enjoy the dividend income from long-term investments. In Public Offering of Fund, because most of them have no lock-up period, they can apply for redemption every day, so they need to face the constraints of investors' daily redemption. Most of them are short-term and highly liquid products, and they also need to reserve some cash.

In addition, the products invested by private equity funds are more flexible and rich in strategies, and they can invest in stocks, futures, bonds, options, arbitrage, etc. Public Offering of Fund mostly focuses on stock and bond strategies, and relatively few strategies.

Therefore, when investors accept higher investment and lower liquidity, they need private equity funds to provide higher returns.

3 industrial fund

If you have decided to invest in a single industry fund, such as medical industry fund and new energy industry fund, you can choose Public Offering of Fund, which is not the advantage of private equity funds.

4 fund manager

Private equity funds can extract 20% of positive income as performance compensation. For example, if they help their clients earn 6,543,800 yuan, they can get 20,000 yuan in performance compensation, so this greatly improves the enthusiasm of fund managers in their efforts to generate income and profit.

In Public Offering of Fund, management fees can only be shared, so fund managers in Public Offering of Fund are more inclined to enlarge the scale and earn more management fees.

5 the choice of different types of funds

If you choose a long-term equity fund with value investment, you can invest in Public Offering of Fund with the same strategy, because there is no 20% performance reward, so it is more cost-effective.

However, some private placements are also price-based stock long-term funds, but they will better control the retracement and adjust their positions according to market conditions, which will have advantages.

In short, Public Offering of Fund and private equity funds have their own advantages and disadvantages, and everyone can judge them according to their own actual situation.

* Financial management is risky and investment needs to be cautious. The above contents are personal opinions, for reference only, and do not constitute any investment advice.