What are the reasons for the discount of closed-end funds? Because closed-end funds are listed on the exchange, their buying and selling prices are greatly influenced by the relationship between market supply and demand. When the market supply is less than the demand, the buying and selling price of fund units may be higher than the net asset value of each fund unit, and then the fund assets owned by investors will increase, that is, a premium will be generated; When the market supply exceeds demand, the fund price may be lower than the net asset value of each fund unit, which means a discount. At present, the discount rate of closed-end funds is still high, mostly between 2% and 4%, among which the discount rate of small and medium-sized funds with short maturity is lower.

For the same fund, it is of course better to buy when the discount rate is high; However, the selection of funds should not only look at the discount rate, but also select some small and medium-sized funds with moderate discount rate and short maturity. According to domestic and foreign experience, it is normal that the price of closed-end fund transactions is discounted. The discount will affect the investment value of closed-end funds. In addition to investment objectives and management level, discount rate is an important factor in evaluating closed-end funds, and there are certain investment opportunities for investors with high discount rate. Closed-end funds should be paid or liquidated according to their net value after their operation expires, so the higher the discount rate, the greater the potential investment value of closed-end funds.

Factors affecting the discount rate

1. Fund management level

Funds with high management level and large scale have stronger sustainable profitability. The risk of buying this kind of fund is small and the discount rate is relatively low. Relatively speaking, the discount rate of small-cap funds or funds with poor profitability issued by some small fund companies is relatively high.

2. Market Quotes

In a bull market, the profits of funds increase and the market sentiment gathers, so a large number of investors will buy funds, which will push up the market price of funds and reduce the discount rate of funds accordingly. On the contrary, in a bear market, the discount rate of funds is relatively high.

3. Fund maturity date

As the fund maturity date approaches, it is less and less likely that the fund's net value will fluctuate greatly. At this time, the transaction price in the market will gradually approach the fund's net value, and the discount rate will be reduced accordingly, and finally it will be reduced to zero.

4. Dividend potential

Dividend of closed-end funds means that some funds can be realized in advance, which will increase the transaction price of funds. The net value of the fund is determined by the fund performance, and the fund performance will not increase because of dividends. Therefore, when a closed-end fund may have a large proportion of dividends, the transaction price will often be close to the net value of the fund, and the discount rate will become smaller.

5. Special events

When a fund has special events such as "closed to open", "early liquidation of the fund", "tender offer of the fund" and "repurchase of the fund unit", the transaction price of the fund will be close to the net value of the fund, and the discount rate will be reduced accordingly.