Index funds belong to compound interest products. Changes in the net value of index funds in the next trading day shall be calculated according to the net value of the previous trading day. The net value of the next trading day is higher than that of the previous trading day, indicating that the fund is profitable, so the index fund is a compound interest product.

What is an index fund?

Index fund refers to a fund product that takes a specific index (such as Shanghai and Shenzhen 300 Index, Standard & Poor's 500 Index, NASDAQ 100 Index and Nikkei 225 Index) as the target index, takes the index constituent stocks as the investment object, forms a portfolio by purchasing all or part of the index constituent stocks, and tracks the performance of the target index.