closed-end fund


A fund with a fixed number of shares outstanding, and one which does not redeem shares the way a typical mutual fund does. Closed-end funds behave more like stock than open-end funds: closed-end funds issue a fixed number of shares to the public in an initial public offering, after which time shares in the fund are bought and sold on a stock exchange, and they are not obligated to issue new shares or redeem outstanding shares as open-end funds are. The price of a share in a closed-end fund is determined entirely by market demand, so shares can either trade below their net asset value ("at a discount") or above it ("at a premium").
also called closed-end investment company or publicly-traded fund.

Use closed-end fund in a sentence

The stock prices of a closed-end fund fluctuate according to market forces as well as the changing values of the securities in the fund's holdings.

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It was a closed-end fund which meant that there were a fixed number of shared and did not operate in the same way.

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The financial adviser had suggested the employee of the company invest in a closed-end fund to resemble the stock ownership experience.

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fixed maturity plan discount