You should make clear the difference between the net value of the fund and the stock price. If the stock price rises to a certain extent and exceeds the value of its listed company, it may fall back. The share price is pushed up and suppressed by the transfer of investors in the secondary market. Generally, it will be adjusted if it deviates too much from the value of listed companies. Therefore, Buffett likes to buy stocks with high margin of safety (the lower the price, the higher the margin of safety); When the stock exceeds the value too much, it will face a plunge, and when the stock price is too low, it will slowly rise;
Net fund value is not the same thing. Will not be limited by the upper limit. In other words, if a fund is well managed, it will not be divided into dividends, so the net value can continue to rise. The net value of China's big market has been more than ten dollars, and there are hundreds of thousands of good foreign funds. How is the net fund value calculated? That is, after the end of each trading day, the fund company will settle the actual asset market value of all stocks, bonds and other targets invested by the fund (because stocks and bonds will rise and fall every day, and they are not fixed every day). Subtract the actual market value from the cost liabilities of the fund (including the transaction costs, management fees and custody fees of the day) to calculate the net assets of the total assets of the fund. Then divide by the latest total fund share, and get the fund net value of the day (commonly known as the daily price of the fund, just like the daily price of Chinese cabbage). Investors buy and sell every day and calculate their share or market value according to the net value (unknown) of the trading day.
If many stocks invested by a fund reach or exceed the value excessively, that is, the margin of safety is getting lower and lower, and there is a risk of falling back at any time, then the fund manager will appropriately throw away those "dangerous" stocks and buy other stocks with high margin of safety, so the fund will generally not rise to a high level and suddenly plummet like stocks, because it is not suitable for reflecting the value of a stock, but the appreciation of all investors (people who buy funds), that is, the total amount will become less changeable. The more the value of fund assets increases, the more management fees the fund company earns, the better the benefit of the fund company and the better the income of the fund manager. So it's a ring, and everyone wins.
Which funds grow to a certain extent and split into dividends is mainly for the benefit of investors, because many people misunderstand that the growth space of funds will be limited when they rise to a certain extent, so they dare not buy which funds grow well and rise rapidly, then the total assets of funds will be limited, so fund companies will reduce their net worth through dividends or splitting, and then some people will buy them, but excessive dividends or splitting will force fund managers to sell some stocks or even good stocks, which will not be worth the candle.
Anyway, good funds should not be afraid of high net worth, and poor funds should not be bought even if they are cheap. There are also net worth that will be disturbed by bull and bear markets. For example, even if the net value of the big bull market is high, it will continue to rise with the big bull market; The big bear market will fall even if its net value is cheap, including funds below 1 yuan, which is even more common.