, investors will find that some financial products will show information such as net value, net value date, etc. Most people who have experienced investing in financial products are more familiar with data such as annualized expected rate of return, and are more unfamiliar with net value. So what does the net value in wealth management products mean and will the net value change?
1. What does the net value in wealth management products mean
net value is generally presented in net value financial product information, referring to the net asset value of each unit proportion product. The accounting formula is: unit net value = total net asset/product ratio. The initial net value of
wealth management products is generally 1, but the net value of the product will change, with both rise and fall. It is generally released in fixed cycles such as daily, weekly or monthly.
In the past, bank wealth management products would release expected yields, and after the product holding expires, investors can generally obtain practical expected returns that are roughly appropriate to the expected yields, with rigid redemption.
But now bank wealth management is transforming into net value wealth management products. The primary feature of net value wealth management products is that they do not guarantee principal and interest, and they do not promise expected yields. The expected income of
net value wealth management products is calculated based on the product net value. A brief understanding is: if the net value is 1 when purchasing a wealth management product, then when changing it, if the net value is higher than 1, it is a surplus, and if the net value is lower than 1, it is a loss, but regardless of the profit or loss, it is borne by the investor.
2. How to determine the expected rate of return for net value wealth management products
The historical net value in wealth management products represents the product's past expected returns, but does not point to the expected expected returns. Investors often cannot predict the expected rate of return of net value financial products, but they can refer to the benchmark for product net value and performance. It is important to note that the same benchmark for performance does not mean that expected expected returns are promised.
