Many investors who invest in index funds have such questions. Will the share and size of the fund change? How did it change? Here is a brief introduction to help you understand the share and size of the fund.
Will the share and size of the fund change with the change of supply and demand? Is it true that the more people buy, the larger the fund size and the larger the share?
Funds can be divided into open-end funds and closed-end funds. Generally, closed-end funds are not open to subscription and redemption, and their fund size may change, but their shares are usually unchanged. However, there are few closed-end funds at present. The vast majority of funds are open-end funds.
Open ended funds can be purchased and redeemed. When we apply for open ended funds, we give the money to the fund company, which will generate new fund shares and give them to us. In this process, the fund shares will increase. Accordingly, we redeem the open-end fund, and the fund will sell a part of its shares, get cash, and then exchange the cash for our fund shares and write them off. In this process, the share of the fund decreases.
