1. Where does the capital turnover come from?
Generally speaking, the turnover rate is calculated by the data in the annual report of the corresponding fund company according to the turnover rate calculation formula. Its calculation method is: turnover rate = (total amount of stocks bought and sold during the period /2)/ average market value of stocks in the last five quarters.
Investors can directly check the annual report in official website, and then they can calculate the fund turnover rate. After calculating the fund turnover rate, according to the turnover rate, they can understand the operation style of fund managers and the changes in market prices.
2. How to treat the fund turnover rate?
Fund turnover rate is an index reflecting the trading frequency of fund stocks, which reflects the operating style of fund managers to some extent.
1) When the turnover rate of a stock is below 3% and it is relatively inactive, generally speaking, 3% is a boundary, and the daily turnover rate of most stocks is 1%, excluding newly listed stocks), and the turnover rate of 70% stocks is basically below 3%;
2) When the turnover rate of a stock is between 3% and 7%, the stock enters a relatively active state;
3) When the turnover rate of a stock is between 7%- 10%, it is a strong stock and its share price is highly active.
The higher the turnover rate of the fund, the better. The higher the turnover rate of the fund, the more frequent the fund operation, which will cause the instability of the fund, and in serious cases will destroy the management level and expected income of the fund.
That's all about where to look at the fund turnover rate. I hope it will help everyone. Warm reminder, financial management is risky and investment needs to be cautious.