Buying split and graded funds, what is the merger and split of funds, many people who buy funds will inevitably have questions. In order to solve your questions, Bian Xiao has compiled the Purchase of Split and Graded Funds. I hope you will like it!

Purchase split and graded funds

Under a portfolio, fund classification can be divided into two or more levels, and the risk-return performance is different. The operation modes of merger and split of graded funds are split and sold, bought and redeemed.

Graded funds are also called "structured funds". Then the split fund is called the parent fund, and its two sub-funds are called Grade A and Grade B. Of course, the relationship between Grade A and Grade B is not simple. Grade A lends its own money to Grade B for investment, while Grade B tries its best to guarantee the principal of Grade A, it needs to pay interest to Grade A on a regular basis ... In addition, the remaining profits and losses in the total investment shall be borne by Grade B. Simply put, I lend my money to you for investment, so it doesn't matter to me whether you make a profit or a loss, as long as you pay me the agreed fixed interest and try your best to guarantee my principal.

For Grade A, fixed interest income can also ensure the safety of the principal, while for Grade B, it can double the principal, gain higher leverage and make better investment operations, but the risk will be higher.

If you buy shares A and B on a certain day, you can merge them into a parent fund at+1 on a certain day and redeem them at +2 on a certain day.

One day to buy the parent fund, +2 days to split, +3 days to sell the sub-fund.

In a graded fund, the sum of the products of the net value of each sub-fund and the share ratio is equal to the net value of the parent fund. If the parent fund is not split, it is a general fund. Since there is a split, of course, Grade A and Grade B can also be merged into a parent fund. Therefore, at the time of purchase, Grade A and Grade B can be bought and sold in the secondary market, but they cannot be purchased and redeemed. The parent fund can be purchased and redeemed. As for whether you can buy or sell in the secondary market, it depends on whether your fund is from the Shanghai Stock Exchange or the Shenzhen Stock Exchange. They are different.

How to buy graded funds

To make progress in Class B and purchase graded funds, you need to open a securities trading account and trade like ordinary stocks, but there is no stamp duty when selling. Many brokers will charge less commission for fund trading on the market than buying and selling stocks.

Aggressive Class B funds are all leveraged, and the fluctuation range will be greater than the index target they track. Don't forget the risks of leveraged products while gaining benefits. In addition, except for individual sustainability, most graded funds have conversion periods, so special attention should be paid.

Method:

One is to open an account in a securities company and trade B products on the floor.

Second, the fund's off-site subscription is transferred to the market, split into AB shares, leaving A to sell B, and of course, you have to open an account in a securities company.

A graded fund is a parent fund that is sold by the fund or purchased through direct sales channels, and then transferred to the market and split into A shares and B shares.

Two parent funds = 1 A shares+1 B shares.

Is there a handling fee for the split and merger of graded funds?

There is no charge for the merger and split of graded funds, but there is a charge for redemption or sale.

T-day subscription of parent fund (on-site subscription)

T+2 days (very few have T+ 1).

Before 3pm on T+2, select the option of "merger and split" and enter the parent fund code.

On T+3, you can see that the parent fund in the account disappears and becomes two sub-funds of Class A and Class B, and then you can sell it.

Purchase, merger and redemption

Buy a and b shares on t day

T+ 1 merged into the parent fund.

T+2 days redeemable