EFT fund is a trading open index fund, which is listed on the exchange and has variable fund share. Trading open-end index fund is a special type of open-end fund.

It combines the operating characteristics of closed-end funds and open-end funds. Investors can not only buy or redeem fund shares from fund management companies, but also buy and sell ETF shares at market prices in secondary markets such as closed-end funds.

Redemption operation of ETF:

ETF redemption transaction means that investors can purchase and redeem ETF shares in the form of portfolio securities in the primary market at any time within the time stipulated in the contract. That is, at the time of subscription, investors exchange a designated basket of portfolio securities for ETF shares from the fund manager; When redeeming, exchange ETF shares for a basket of portfolio securities.

Arbitrage mechanism of ETF;

When the price of the same ETF share in the secondary market and the primary market is inconsistent, arbitrage trading will follow. Investors can use the latest fund share reference net value (IOPV) estimated in real time as the basis for trading and arbitrage, and finally promote the formation of the transaction price in the secondary market.