Fund conversion means that after investors hold any open-end fund issued by a certain fund company, they can directly convert the fund shares they hold into other open-end funds managed by the fund company. A business model that provides fund shares without the need to first redeem the funds already held and then subscribe for the target fund.

To put it simply, if you hold open-end fund A in a certain fund company, you can directly convert it into open-end fund B of this fund company. You do not need to redeem A first and then buy B.

According to the definition, we can know that fund switching has two advantages:

1. Low transaction costs and save money.

Except for commodity funds, fund subscriptions and redemptions require handling fees.

To switch funds, you only need to pay the "difference in subscription fees of the two funds" and the "redemption fee of the transferred fund".

That is, the fund switching fee = the difference between the subscription fees of the transferred-out and transferred-in funds + the redemption fee of the transferred-out fund

For example, if your account holds 10,000 yuan Fund A now wants to sell and buy Fund B of this fund company. The subscription rate of Fund A and Fund B are both 1.5%, and the redemption rate is 0.5%. If the net value of Fund A is 1.

According to the method of selling first and then buying: selling Fund A, the redemption fee is 50 yuan, and the actual amount received is: 9950 yuan.

If you buy Fund B again, the net value of Fund B is also 1, so the subscription fee for buying Fund B with 9,950 yuan will be 149.25 yuan.

The handling fee for one *** is 5149.25=199.25 yuan.

If we adopt the method of fund conversion: directly convert Fund A to Fund B.

With other conditions remaining unchanged, according to the formula mentioned above, the subscription rates of the two funds are the same, so the subscription fee is waived, so you only need to pay a redemption fee of 50 yuan. Compared with the previous One way saved more than a hundred.

2. High transaction efficiency and time saving.

Under normal circumstances, the redemption time of non-monetary funds is more than T+2 days. It takes about 4 working days for the funds to arrive. Then the new fund is purchased again. The whole process takes 4 or 5 days. working days.

Fund switching generally only takes 1 working day. Through fund switching, you can save the time waiting for funds to arrive.