Watchdog Wealth answers for you.

there are several main reasons for the liquidation of trust products: the duration of trust products expires; Unit net value falls below the stop loss line; The scale of trust products or the number of participating shares can not meet the requirements; Liquidate old products in order to issue new products, etc.

1. Trust products expire

Most of the products declared for liquidation are due to the expiration of the trust period. In particular, unstructured products, most of which last for 1-3 years, choose not to operate after the expiration, which is a "normal death".

2. The unit net value fell below the stop loss line

In this case, fewer products were terminated because of poor investment management of fund managers, and some products were issued in 28, which caused the fund net value to fall below the stop loss line agreed in the trust contract and had to be liquidated by the trust company. At present, most Sunshine private equity products set the stop loss line at 7 cents. If the net value of the fund is below 7 cents for a continuous period of time, the liquidation will be terminated early or the investment strategy will be changed.

3. The scale of trust products or the number of participating shares can't meet the requirements.

Since the establishment of some trust products, their performance has been unsatisfactory, and they have been hovering on the edge of net value for a long time, and even have negative returns continuously, resulting in a large number of holders redeeming products, while their original scale was only 2-5 million. After a large number of redemptions, they could not reach the minimum scale or the minimum share red line agreed in the trust contract, and were forced to liquidate.

4. liquidate old products in order to issue new products

since the opening of securities accounts for trust products was suspended in July 29, the original stock trust securities accounts have become increasingly tight. Private equity companies have to pay a high account cost to issue new trust products.

For this reason, in order to issue new products, some private equity companies choose to liquidate some old products with small fund management scale and unsatisfactory returns, and use the securities trust account of the old products to re-issue new products.