Index funds are funds that track certain indexes (such as Shanghai and Shenzhen 300 Index, S&P 500 Index, Nasdaq 100 Index, Nikkei 225 Index, etc.). ), and select all or part of the constituent stocks of the index to build a portfolio, such as the 300 index fund that tracks the Shanghai and Shenzhen 300 Index. Generally speaking, index funds aim at reducing the tracking error, making the portfolio change trend consistent with the underlying index, so as to obtain the expected annualized rate of return roughly the same as the underlying index.

How to calculate the income of index funds?

Calculation of several funds:

The expected annualized income of index funds comes from the price fluctuation and dividend distribution of investment targets, which is reflected in the fluctuation of index funds' own net value. The formula for calculating the expected annualized income of index funds is the same as that of general funds, which mainly depends on the net value of index funds at the time of subscription/redemption, dividend distribution and various fund fees charged at the time of subscription/redemption.

Calculation formula:

The formula for calculating the expected annualized income of the index fund is = the net value of the index fund on the redemption date ××( 1- redemption rate)+dividend-investment amount, that is, the capital invested at the time of subscription.

Among them, index fund share = index fund investment amount ×( 1+ index fund subscription rate) ÷ index fund subscription date net value+index fund interest. (When calculating the expected annualized income of index funds, we can know that the subscription rate has a great influence on the expected annualized income of the fund.