What are the rules for closing short positions of funds? Perhaps for many people, the rules of fund short positions need to be understood. After all, understanding the short positions of funds can help us operate better. Therefore, Bian Xiao specially arranged the clearing rules for short positions of funds for everyone, and I hope you like them.

Liquidation rules for short positions of funds

The short position of the fund means that the net asset value of the fund drops rapidly, which cannot meet the large number of redemption requirements of investors and needs to be closed. Here are some rules about short positions of funds:

Redemption ratio: According to the regulations of China Securities Regulatory Commission, when the fund share holders demand redemption, the fund company shall make redemption payment according to the redemption ratio agreed in the fund contract. Even if the fund faces short positions, it should still try its best to meet the redemption needs of investors in the liquidation process.

Liquidation process: When the fund explodes, the fund manager needs to start the liquidation procedure as soon as possible, realize the liquidation assets and make liquidation distribution according to the relevant provisions of the fund contract. Liquidation procedures include fund property protection, liquidation price calculation, liquidation expenses determination, liquidation distribution and other links.

Protection of investors' rights and interests: fund managers should ensure that all fund share holders are treated fairly in the liquidation process. According to the fund contract and laws, investors have the right to obtain corresponding liquidation income. At the same time, the regulatory authorities will also strengthen the supervision of fund short positions to protect the legitimate rights and interests of investors.

It should be noted that the specific liquidation rules of fund shorts may be different. Investors are advised to read the fund contract and relevant laws and regulations in detail, understand the handling methods of fund companies in the case of short positions, and pay attention to the relevant notices and regulations issued by the regulatory authorities in time. In addition, you should carefully evaluate the risk level of the fund before investing in the fund and choose the investment products that suit you.

What is capital settlement?

Fund liquidation refers to the process that the fund manager terminates all investment behaviors of the fund after the fund contract is terminated, with a view to liquidating and paying off the fund assets within a certain period of time. Fund liquidation is one of the necessary procedures of fund contract, which involves the protection of the rights and interests of fund share holders.

What are the rules for fund liquidation?

In China, fund liquidation is governed by Fund Law, Fund Management Measures and Securities Investment Fund Information Disclosure Management Measures. The main provisions are as follows:

1. When the Fund Contract expires or other termination circumstances stipulated in the Fund Contract occur, the fund share holders have the right to ask the fund manager for liquidation.

2. The fund manager shall liquidate and cancel the fund property within the statutory time limit.

3. Fund liquidation shall follow the principles of fairness, justice, honesty, diligence, prudence and confidentiality, and protect the interests of fund share holders.

4. The fund manager shall carry out asset valuation according to the prescribed procedures, formulate liquidation plan, and conduct liquidation after being audited by the fund share holders' meeting or the fund custodian.

5. There are different liquidation methods and standards for different types of funds. For example, smaller funds can be liquidated in cash, and larger funds can be liquidated through listing transactions.

Characteristics of hedge funds

The concept of hedge fund is still relatively broad, and many financial products are essentially operated by hedge funds. Hedge funds use leverage to invest more, and hedge funds can also short, and the handling fee is generally higher, including management fees and sharing fees.

Hedge funds do not guarantee profits, and most of them belong to private investment companies, and their leverage will be higher. Therefore, hedge funds are mainly suitable for institutional and individual customers with large funds, and ordinary investors are often unable to bear their risks.

Will the fund account explode?

Theoretically, it is possible for a fund to break out, but the probability is not great. Because the foundation has a series of risk control measures, such as holding a single stock does not exceed 5% of the total market value of the position. If the fund bursts, it means that the risk control is too bad. The situation of private equity funds is relatively large. I have seen that private placement has no risk control measures at all, and Man Cang can hold a stock.