When the fund price is higher than the net value of the fund unit, it is called fund premium.

It means that when the fund sponsors set up the fund, the total amount of issuance is determined in advance. When the total amount raised exceeds 80% of the total amount, the fund is declared to be established and closed, and no new investment will be accepted during the closed period. For example, funds listed on Shenzhen Stock Exchange were established in Kaiyuan (4688) and 1998, and issued 2 billion fund shares, with a duration (closed period) of 15 years.

In other words, the operating period of the fund from 1998 is 20 years, and the operating quota is 2 billion. During this period, investors can't ask for the return of funds, and the fund can't add new shares. Although investors are not allowed to ask for the return of funds during the closed period, funds can circulate in the market. Investors can cash out through market transactions. The circulation mode of closed-end fund shares in China is listed on the stock exchange, and investors must bid for and buy fund shares in the secondary market through securities companies.