Describe the functions of open and closed end funds and explain the key difference between them....

Describe the functions of open and closed end funds and explain the key difference

between them. Which of the two represents the more attractive investment?

Solutions

Expert Solution

Close-ended funds might be attractive because they are actively managed funds to beat the general market return. They are traded on a stock exchange.

Opened funds are always valued at NPV. It's not in the case of Close-ended funds.

Close-ended funds strategy:
When the price is discount to NAV it's better to buy, When the price is premium to NAV its best time to sell a close-ended fund.

jeff jeffy answered 2 months ago

Next > < Previous

Related Solutions

How do ETF’s work? What is the difference between an ETF and Closed and Open End...

How do ETF’s work? What is the difference between an ETF and Closed and Open End Mutual Funds? If you are saving for your retirement does the choice have a big impact?

Discuss the difference in their structures that explain these differences between a closed-end fund and an...

Discuss the difference in their structures that explain these differences between a closed-end fund and an open-ended mutual fund: a) When investors buy shares of the open-end mutual fund (in the aggregate), the number of fund shares increase. But, this is not the case with a closed-end fund. Why? b) An open-end mutual fund keeps a larger % cash (or cash-equivalent) allocation in the portfolio than the closed-end fund does. Why?

Question

Describe the functions of open and closed end funds and explain the key difference between them....

Solutions

Expert Solution

Related Solutions

How do ETF’s work? What is the difference between an ETF and Closed and Open End...

Discuss the difference in their structures that explain these differences between a closed-end fund and an...

Types of Mutual Funds include the followings except Select one: a. Open-end mutual funds b. Closed-end...

Mutual Funds. What’s the difference between an open-ended and closed-ended mutual fund? Why does it matter...

What is the difference between Open and Closed Circulatory Systems? What is the difference between atrioventricular...

Define and explain Foreign Direct Investment. What is the difference between a closed and open Economy?...

In the context of decision making theories, describe the difference between open-loop and closed loop models.

Please compare the Open-End versus Closed-End Mutual Funds (7 marks) (250 words limit)

1) What is the difference between the closed center Dc valve and the open center Dc...

Describe the key functions of the US health system, and analyze them within the context of...