A friend asked: "Is it better to buy funds now or convertible bonds?"

To analyze this question, at least three perspectives are needed to arrive at the correct answer, but most people tend to think about it from only the first and second perspectives:

1. Analyze which investment option is better between funds and convertible bonds?

Both funds and convertible bonds have their own strengths and weaknesses, and it's not possible to say which one is better. There are many types of funds, including money market funds, equity funds, bond funds, etc., with a wide range of investment scope.

Moreover, equity funds tend to have the highest long-term investment returns, and their annualized returns are generally higher than those of convertible bonds. As a special type of bond, convertible bonds have the attributes of bonds and also have the function of converting into stocks, so they have better capital preservation and the opportunity to convert into stocks.

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2. Which investment option is more suitable at the current time?

In the current market, I believe that investing in funds is better, especially equity funds. This is because the A-share market is currently at a historical low, and it is a great time to invest in A-shares through equity funds. Convertible bonds, after all, are bonds, and their gains in a bull market will generally lag far behind stocks.

3. Analyze which investment option is suitable for oneself?

Although it is more suitable to invest in funds at present, it is necessary to choose according to one's own risk tolerance. If one has a poor risk tolerance, then convertible bonds should be chosen at any time. If one has a strong risk tolerance and can accept a floating loss of more than 30%, then investing in equity funds is certainly a better choice.

A fan friend asked, "How to understand the impact of the main force on stock prices?"Firstly, we investors must clearly understand that only the fundamentals of a listed company can determine the long-term trend of stock prices. Without the support of the company's fundamentals, everything is just an illusion.

In the past, there was a super power in the A-share market, known as the "Delong System". It bought a large amount of stocks to manipulate the market and controlled the stock prices of several listed companies at the same time. In the end, due to the poor fundamentals of most of the stocks it bought, when its capital chain broke, there was no other capital to take over, and the stock prices eventually plummeted continuously.

The Xinjiang Tunhe it controlled was eventually acquired by COFCO Group and renamed COFCO Tunhe, and was later injected into COFCO Sugar Industry (600737) as a whole by COFCO Group. COFCO Sugar Industry is still trading normally at present. The control of the alloy investment (000633) it controlled at that time has changed several times, and it is now in a state of no actual controller, with the company's stock price only more than 5 yuan, and the performance is poor.

Xiang Torch (000549) was delisted and acquired by Weichai Power, which is still trading normally at present. ST Zhongjie (002021) has been in poor performance for many years, and the stock price has been low for a long time. The Delong System once held a controlling stake in *ST Deao, but the company's main business suffered severe losses and has now been completely delisted.

ST Huangtai (000995) was suspended from listing in 2019 and resumed listing at the end of 2020. The performance is still low at present. ST Site (000760) was forcibly delisted in 2021. It can be seen that the once super power did not bring long-term benefits to these stocks, but most of them ended up being acquired or even directly delisted due to poor performance of the company's fundamentals.

Secondly, we investors must understand that the main force can only have a short-term and medium-term impact on stock prices. The main force is not an omnipotent god. The above examples illustrate this issue. If the retail investors think that the above main force is not strong enough, then the national team should be strong enough, right?

At that time, in order to protect the market, the national team entered the market at more than 4000 points and invested more than 1 trillion yuan to boost the stock prices. Although it did indeed lift the limit down boards of thousands of stocks at that time, the national team was also trapped for many years, and there are still some stocks that have not been able to break even to this day.

Human efforts have their limits, and the way of heaven has its fixed laws. Only by recognizing this can we firmly believe in value investment and firmly embark on the right path of investment.