Group 1 - The article discusses the recent recovery of A-shares and H-shares, with major broad-based indices steadily rising and some industry indices experiencing structural surges. Core indices like the CSI 300 and CSI 500 have returned to reasonable valuation ranges, while some aggressive indices have even entered a slightly high position [5] - As the number of investable equity products decreases, investors are seeking a "reasonable landing point" for new and future funds, leading to increased interest in bond funds as a lower volatility and lower drawdown investment tool [5] - The current yield on China's 10-year government bonds is 1.73%, which, despite a slight rebound from previous lows, remains at a historical low level [5] Group 2 - Bond funds are essentially tools that pool money to purchase bonds, which are contracts for borrowing money and receiving interest. Bonds can be categorized into three types: government bonds, policy financial bonds, and corporate bonds, with varying levels of risk and return [7] - The return of bond funds consists of two main components: coupon income from regular interest payments and capital gains from the appreciation of bond prices. The perceived stability of bond funds is contingent on market interest rates not fluctuating significantly [8][9] - Investors should be aware of potential risks within bond fund structures, such as high exposure to lower-rated corporate bonds or long-duration bonds, which can amplify sensitivity to interest rate changes and lead to unexpected volatility [9] Group 3 - The relationship between bond prices and bond fund returns is described as a seesaw effect, where rising interest rates lead to falling bond prices and vice versa. Long-duration bond funds are particularly sensitive to interest rate changes [10][11] - Currently, the 10-year government bond yield of 1.73% is significantly below the historical average and the central bank's long-term reasonable range of 2.5%-3.0%, indicating that bond prices are at historical highs and future returns may carry implicit risks [11][12] Group 4 - With the risk-free interest rate at historical lows, a mechanism is needed to adapt investment strategies. When the risk-free rate exceeds 3.0%, long-duration bond funds may offer better value; at 2.5%-3.0%, medium-duration bond funds are advisable; and below 2.0%, shorter-duration options should be considered to mitigate interest rate risk [13][14] - The selection of bond ETFs or off-market products should focus on duration, credit quality, and liquidity. Short-duration products are recommended in the current low-rate environment to reduce net value drawdown risks [15]