Fund operation terms
1. Long and short
Going long refers to the behavior of investors who are optimistic about the market outlook and are willing to buy fund shares with the current net value of the fund. Going long is a buying behavior, which must be taken only after analysis and judgment, optimistic about the stock market outlook.
Short selling refers to the behavior of investors who believe that the market outlook for the fund will fall and redeem the fund in advance to lock in profits or avoid greater losses.
2. Short-squeezing and stepping
Shorting refers to the process in which the net value of the fund continues to rise in a short period of time, so that some investors who originally hoped to buy again when the net value of the fund declines have not had a good opportunity to enter the market, and finally have to buy at a high level.
Going short refers to the process in which the net value of the fund has always been above the psychological price of investors who are willing to invest, causing them to be unable to accept the current price and can only be in a state of waiting for a short position, resulting in a missed market.
Stepping and squeezing go hand in hand, and only when the market for squeezing is produced, the behavior of stepping will occur.
3. 7-day annualized rate of return
The 7-day annualized rate of return is a very important indicator for measuring the rate of return in a currency fund. It refers to the annualized rate of return converted into the net income of a currency fund for every 10,000 fund shares in the past 7 days. The 7-day annualized rate of return is only a short-term indicator, which cannot reflect the actual annual return of the fund. It is only used as a reference.
Assuming that the value of a currency fund before the first day of trading is A, the value after the seventh day of trading is B, and the 7-day fee is C, then the 7-day annualized rate of return = (BAC)/A/7x365x100%.
The larger the monetary fund, the higher the annualized rate of return, because it has a higher right to speak in the market, so if investors choose a monetary fund, the size of the fund will be an important measurement indicator.
4. Daily income of 10,000 fund units
The formula for calculating the daily income of 10,000 fund units: Daily income per 10,000 fund units = Fund income on the day/Total number of fund units on the day x 10,000.
It can be seen from the calculation formula that this is a quantitative indicator, that is, the investment income generated on the day is equally spread to the fund shares, and then 10,000 fund shares are used as the quantitative standard for measurement and comparison.
This indicator represents the actual income of the investor that day.
V. Fund subscription fee rate
Subscription is an exclusive term for funds, and investors understand it as buying. The fund subscription fee rate is the fee rate when the investor buys the fund.
There are two parts of funds to purchase funds, namely subscription fees and net subscription fees. The subscription fee is calculated based on a certain percentage. The conventional method is to multiply the total purchase price (including fees) by an applicable fee rate.
For example: an investor wants to buy 10,000 funds and the subscription fee rate for the fund is 2%. Assuming that the net value of the fund is 1 yuan, the actual fee that the investor needs to pay has two parts: one is the subscription fee calculated based on the subscription fee rate The cost is 200 yuan, and the second is to buy a predetermined fund share of 10,000 yuan according to the net value of the fund. When the investor wants to complete this transaction, the actual fee paid is actually 10,200 yuan.
6. Fund redemption fee rate
The simple understanding of redemption is selling, that is, the behavior of investors selling the fund shares in the account to the fund management company and obtaining cash.
The fund redemption fee rate is the expense ratio when the investor sells the fund. The redemption of the fund is based on the method of share redemption, that is, when investors apply for redemption to the fund management company, the unit is used as the unit, rather than the price as the unit like stocks.
The amount that investors actually get after selling the fund is also divided into two parts, namely the total amount of redemption and the part that needs to be deducted from the redemption fee.
For example: Suppose an investor sells 10,000 fund shares with a fund net value of 2 yuan, and the redemption fee rate is 2%, then the investor actually gets funds = 20000-400 (redemption fee) = 19600 (yuan).
7. Fund dividends
In addition to redeeming the fund shares as a means of obtaining investment income, investors can also choose fund dividends.
Fund dividends means that the fund management company obtains investment income in the market, and then distributes part of the income to fund holders in the form of cash.
Dividend income is originally a part of the fund’s net value. Dividends are simply investors who get their own book assets in advance, which is why the fund’s net value will fall on the day of dividends (ex-rights day). If the net value of the fund rises again in the future, the dividends will be the real income of the investors.
Generally speaking, fund dividends refer to securities investment funds. Dividends are only part of the cash after the fund's net value grows. It is not that the more the better, the better the standard for measuring the fund's performance is the growth of the fund's net value.