The reason why the fund price is lower than the net value
1, closed-end fund
For closed-end funds, the fund below its net value means that the intrinsic value of closed-end funds is higher than its market price.
1) The first possible reason is that closed-end funds can't apply for redemption at any time like open-end funds, so their price is lower than their intrinsic value, which implies the risk of fund maturity;
2) The second possible reason is that there are a large number of investors in the financial market who can't obtain internal information and irrationally trade noise as information. Their behavior has a great influence on the stock price, which limits the arbitrage trading.
2. Open fund
The net value of fund share refers to the total value of fund property calculated according to the market closing price of each open day. After deducting the costs and expenses of the fund on that day, the net asset value of the fund on that day is divided by the total number of fund units issued on that day.
The biggest reason for open-end funds should be that the accumulated net value of the fund is equal to the sum of the net value of the share on the day since the establishment of the fund and the accumulated dividends.
The net value of some fund shares is lower than the face value, and the accumulated net value is high because the accumulated net value of the fund is equal to the net value of the fund shares after deducting dividends.
The above is the reason why the fund price is lower than the net value, and I hope it will help everyone. Warm reminder, financial management is risky and investment needs to be cautious.