1. What is LOF Fund?
LOF, also known as listed open-end fund, refers to the open-end fund that has been listed and traded. Compared with ordinary funds, LOF funds can be traded on exchanges, which means that investors can trade by buying or selling fund shares listed on exchanges, thus increasing the flexibility and liquidity of funds.
Second, the advantages of LOF fund
1. Strong liquidity: LOF funds are more convenient for listing and trading, and investors can buy and sell through securities accounts without worrying about redemption difficulties and income issues like closed-end funds.
2. High market transparency: LOF funds are listed and traded on the exchange, so the fund net value and share trading are announced every day, so that investors can know the fund situation at the first time.
3. Strong ability to cope with market changes: LOF funds can invest in a flexible exchange trading environment, respond to market changes in a timely and effective manner, optimize investment portfolios, and reduce risks.
4. Low investment threshold: LOF funds usually need a lower minimum investment amount, which is more grounded than other fund types.
Third, the risk of LOF fund.
1. market risk: the investment risk of LOF funds is highly dependent on market trends. When the market fluctuates greatly, the net value of the fund will also be greatly affected.
2. Easy to be trapped: In some cases, the preferential price of fund shares will disappear, and the buyer may bear a large purchase cost and will be trapped when the price falls.
3. Operational difficulties: market liquidity will make it difficult for funds to be traded in real time and may not be redeemed when necessary.
4. Performance of the fund manager: The dividend and issue price of LOF fund are determined by the fund company, which may have an impact on the fund performance.
Fourth, how to choose LOF fund?
1. Choose a fund whose long-term goal corresponds to its financial strength.
2. People who buy LOF funds for the first time should buy large-scale funds with excellent performance and choose fund companies with safety records.
3. The investment performance of the selected fund ranks high in the industry, with the characteristics of stable performance and controllable risks.
On the whole, LOF fund is a more flexible and liquid fund product. Investors can choose the appropriate LOF fund according to their investment needs and risk tolerance. Generally speaking, funds with good performance, large management scale, good market reputation and certain risk diversification characteristics are more suitable for investors to buy.
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