I don't know if you know about closed-end funds, so the following small series will bring you how to choose closed-end funds. I hope you like it!
How to choose closed-end funds
First, choose closed-end funds with large discount rate. After the operation of closed-end funds expires, they shall be paid or liquidated according to their net value. The higher the discount rate, the higher the relative income in the later period of operation.
Second, choose small and medium-sized closed-end funds. This is the same as stocks. The smaller the disk, the more speculative it is. Especially in the later stage of operation, in order to compete for the voting rights, the main players often make big acquisitions, which greatly raises the fund price and even leads to premium phenomenon.
Third, pay attention to the continuous dividend-paying ability of closed-end funds. The dividend of the fund depends on the performance. If the performance is not good, then the level of fund managers is not good, and the net fund value and the secondary market price will go down.
Fourth, pay attention to the positions of closed-end funds. Like open-end funds, the profitability of closed-end funds mainly comes from heavy stocks or other market investment targets. If the future trend of heavy stocks or other market investment targets is good, it will naturally have more investment value.
Fifth, choose the right time to enter the arena. There are bull and bear markets in the stock market, and so are closed-end funds. If the investment target is a bear market, such as a bear market, it is difficult to make short-term profits through secondary market transactions. The same is true of buying stocks. It is important to choose a good stock, and it is more important to choose when to enter the market.
What does a closed-end fund mean?
Closed-end fund refers to the fund sponsors who limit the total issuance of fund units when setting up funds. After the total amount of fundraising is completed, the fund is announced to be established and closed, and no new investment will be accepted for a certain period of time. The circulation of fund shares is listed on the stock exchange, and investors must bid on the secondary market through securities brokers in the future.
Closed-end funds have a fixed duration, during which the overall size of the fund is fixed. Generally listed on the stock exchange, investors can buy and sell fund shares through the secondary market.
Compared with closed-end funds, it is an open-end fund, which refers to the operation mode that the fund scale is not fixed and the fund unit can sell it to investors at any time or buy it back at the request of investors.
How to buy closed-end funds
There are two ways to buy closed-end funds:
When a closed-end fund is established, or when the fund expires, the fund shares are subscribed through the sales organization designated by the fund company. However, it is not recommended to buy closed-end funds in this way, because after a period of time, closed-end funds often have a large discount in the secondary market.
After the establishment of closed-end funds, it is easier to make profits by buying them through secondary market transactions and choosing high-quality closed-end funds at a discount. Trading in the secondary market requires opening a securities account. If you buy a small amount of money, you'd better ask the securities company if there is a minimum handling fee of five yuan when opening a securities account. Because most brokers have it, only a few brokers calculate the commission according to the transaction amount.