What is the arbitrage of LOF fund?
LOF Fund adopts a trading mechanism combining on-site trading and off-site trading to provide investors with the net value of the fund and the on-site trading price fluctuating around the net value of the fund. If the floor transaction price is different from the fund's net value, investors will have the opportunity to arbitrage. (1) When the secondary market price of LOF is less than the net value, after buying LOF in the secondary market, the LOF will be redeemed off-site through on-site redemption or transfer custody; (2) When the secondary market price of LOF is greater than the net value, purchase LOF fund shares on or off the market, and then sell the obtained LOF shares through on-market transactions (it needs to be transferred to the market for off-market purchase). (In actual operation, the handling fee and time factors should be considered. )