the full name of lof fund is a listed open-end fund, which can be purchased or redeemed off-site (fund company, bank counter or securities company counter, etc.) or traded on-site (stock exchange). Today, we mainly want to know which investors LOF fund is suitable for. What are the advantages and disadvantages of LOF fund? Let's analyze it for you:

Which investors are p>LOF funds suitable for?

1. Investors who pay attention to returns

Because LOF funds mainly invest in a basket of stocks and are active funds, they mainly aim at pursuing higher returns, so investors who want to pursue higher returns are advised to trade LOF funds.

2. Short-term investors

On-site LOF funds are subject to T+1 trading. Investors buy funds on the same day, and they can sell and redeem them on the next trading day, and the funds arrive in the account faster, which speeds up the transaction. Therefore, short-term investors are more suitable to buy LOF funds.

3. Investors who want to arbitrage

Because LOF funds can be traded on the market or redeemed off the market, investors can also use this feature to arbitrage and earn the difference. For example, if the LOF fund price on the spot is higher than that on the off-site LOF fund, it can be purchased off-site and sold at a high price on the spot; When the on-site price of LOF fund is lower than the off-site price, it can be bought in the secondary market and then redeemed off-site.

what are the advantages and disadvantages of p>LOF fund?

Advantages:

1. Arbitrage is possible

Because LOF funds can be traded on or off the market.

2. the transaction speed is fast

the fund share can be sold on T+1 day, and the fund money sold can be used on the same day, and it can be withdrawn on T+1 day to speed up the transaction.

3. Reduce transaction costs

Investors can reduce transaction costs through transactions in the secondary market.

Disadvantages:

1. Arbitrage capital requirements are high

LOF funds have a single transaction amount limit, so it is difficult for investors with less funds to arbitrage.

2. There are fewer types of funds

There are fewer types of funds in p>LOF, which may not meet the investment needs of investors who want to invest in a portfolio.

3. It is not suitable for fixed investment

The fixed investment of the fund is to automatically set the time and amount, and the LOF must be manually operated during the transaction, and the single amount is limited. Too little will increase the transaction cost, which is not cost-effective and the expected income will also decrease.