Investment VehiclesQuestion 81 of 100
A closed-end fund's shares:
a.Are always redeemed at net asset value
b.Are sold only by the issuer
c.Trade on an exchange and may sell at a premium or discount to NAV
d.Cannot be bought after the IPO
Explanation
Closed-end funds issue a fixed number of shares in an IPO that then trade on an exchange, where market forces can push the price above or below net asset value. Unlike open-end funds, they do not redeem shares at NAV. Investors buy and sell them like stocks.
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