Offbeat Offerings: Closed-End Funds
Most investors are quite familiar with open-end mutual funds, portfolios of securities that offer diversification and professional management at a low cost even for smaller-sized investors.
Closed-end funds, however, are a sometimes-overlooked alternative. Closed-end funds differ from mutual funds in that once the fund issues shares, those shares are bought and sold in the open market; unlike a mutual fund, the closed-end fund does not itself stand ready to redeem shares from investors wishing to sell their shares. Closed-end fund shares have both a net asset value and a share price, and sometimes trade at discounts or premiums to net asset value.
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