Do I have to look at the net value to buy a fund?
When investors buy a fund, most of them will pay attention to the historical performance of the fund, the fund manager and the fund net value. When investors buy funds, they will choose funds with low net worth, because they think that the lower the cost of buying funds, the higher the income they can get when the funds rise in the future. However, the net fund value and stock price are different mechanisms.
From the formation mechanism of fund net value, the essence of fund performance is determined by the price performance of the underlying assets invested by the fund. Investors buying and selling funds lead to changes in fund shares. Under normal circumstances, unless there are special circumstances such as huge redemption, it will not have much impact on the net value of the fund. The source of long-term growth of fund net value is the value growth of assets such as stocks and bonds invested by fund managers. Even if the current fund net value has reached a new high, whether the fund net value will continue to grow in the future is not directly related to the current situation.
Judging from the influence mechanism of fund net value change, high net worth funds may still obtain excellent returns in the future. As mentioned above, the driving force for the growth of the fund's net value is the appreciation of the value of the assets invested by the fund.
To sum up, when choosing a fund, investors don't need to care too much about the net value of the fund, but need to see if there is room for growth in the future. It should be noted that the net fund value can affect the fund shares held by investors. The lower the net value of the fund, the more shares the buy fund holds, and vice versa.