What are the main determinants of open-end fund prices?
Unlike the closed-end fund price, which is mainly influenced by the market supply and demand, the main determinant of the open-end fund price is the unit net value of the current trading fund. In other words, it mainly depends on the net value of each fund. Next, I will explain it in detail from two cases of fund subscription and redemption.
1. Subscription example:
Xiao Zhang is a fund investor. Now he plans to buy a fund with 5 million yuan. After considering various factors, he chose to buy an open-end fund. It is known that the subscription rate of this open-end fund is 2%, and the actual unit fund net value of the fund is 2 yuan, so the actual transaction price involved by Xiao Zhang is: the subscription fee of the fund is 5 million yuan x2% = 654.38+ 10,000 yuan; The amount required for fund net subscription is 5 million yuan-20,000 yuan = 4.98 million yuan; The subscription share of the total fund is 4.98 million yuan /2 yuan = 2.49 million copies.
2. Redemption example:
It's the same Xiao Zhang fund investor. Now his demand has become a redemption fund, and 5 million fund units have been redeemed. Assuming that the redemption rate is 5% and the net value of the unit fund is 2 yuan, it is necessary to calculate the single redemption price and then multiply it by the total share: the redemption unit fund price is 2 yuan X( 1-5%)= 1.9 yuan; Total amount required to redeem the fund = 5 million x1.9 = 9.5 million yuan.
Through the above examples, it can be clearly concluded that the decisive factor of the open-end fund price is the actual unit net value of the fund. Whether it is an open-end fund or a closed-end fund, investors must choose a fund that suits them.
That's all. I hope it helps you.