Compulsory redemption refers to the behavior that the manager or fund registration institution forcibly redeems the fund shares held by investors according to the established business rules when investors have not applied for redemption. So, is compulsory redemption good or bad?

Is compulsory redemption good or bad?

Compulsory redemption is not good or bad. The minimum holdings are very small and will not have any impact on the fund size or fund net value. Compulsory fund redemption means that when the fund custodian redeems the stock fund from investors, the minimum amount held in the account is less than the amount required by the fund custodian, and the system will make investors own the fund share without the investor applying for redemption. The above is related to whether compulsory redemption is good or bad.

What are the circumstances of compulsory redemption of funds?

1. When investors redeem, when the amount of funds in the account of the consignment agency is less than the minimum holding share, the balance needs to be redeemed together;

2. If the investor's account balance in the consignment agency is lower than the minimum redemption share for other reasons (such as re-custody, non-transaction transfer, etc.). ), his redemption market share is allowed to be less than the minimum redemption share, but it is required to be redeemed at one time. The minimum redemption market share depends on the specific fund.

This article mainly writes about the knowledge points about whether compulsory redemption is good or bad, and the content is for reference only.