By grading the secondary market transaction prices of A and B sub-funds, the virtual transaction price of the parent fund can be deduced. Of course, the parent funds of most graded funds cannot be traded in the secondary market. The virtual price formula of the parent fund is as follows:
Virtual price of parent fund = class A sub-base price X A share%+class B sub-base price X B share%.
When the virtual price of the parent fund exceeds the net value of the parent fund, premium arbitrage can be carried out, provided that the difference between the virtual price and the net value of the parent fund is greater than the transaction cost.