How to choose a good closed-end fund?
1, look at the internal rate of return
Internal rate of return is the discount rate that the total present value of capital inflow is equal to the total present value of capital flow and the net value is equal to zero. It is the expected rate of return of an investment, and the greater the internal rate of return, the better.
Step 2 look at dividends
Through the dividend of the fund, we can understand the continuous growth of the fund's net value. Fund dividends need to meet certain conditions. Funds that lost money in that year can't pay dividends, and the income in that year can't pay dividends before making up for the losses in the previous year.
3. Look at embarrassing stocks
Analyze the growth of fund heavyweights, so the performance of fund heavyweights is very important to the performance of the fund.
4. Look at the turnover rate
Knowing the change of fund turnover rate, we can see the change of investor's holding cost and better analyze the future situation of the fund.
5. Look at the bracket structure.
Pay attention to the share ratio of the top ten holders of closed-end funds. If the holders are very dispersed, there may be some main holders who buy in large quantities to compete for voting rights, which will raise the price of the fund and cause short-term profits of the fund. From this perspective, you can choose a smaller closed-end fund.
6. Look at fund companies and fund managers.
Just like open-end funds, fund companies and fund managers are necessary factors for investigation, and the main points of investigation are the same as open-end funds.
7. Look at the discount rate
The yield of closed-end fund investment depends largely on the discount rate of the fund, and the higher the discount rate of the fund, the better.