Jasz
VIP Contributor
Closed end mutual funds are investment vehicles that trade on a stock exchange. They can be sold at a specific date or during a specified period of time. Closed-end mutual funds are subject to the same rules as open-end funds, except that they trade in a liquid secondary market that allows investors to buy and sell shares easily.
In addition to being more liquid than closed-end funds, open-end mutual funds have lower fees than closed-end ones because they don't have to pay commissions when buying and selling their shares too. Open-end mutual funds are also more flexible than closed-end ones because they can issue new shares or redeem old ones at any time during the life of the fund. Closed-end funds typically trade at a discount to their net asset value (NAV), which is the value calculated by subtracting liabilities from total assets.
In addition to being more liquid than closed-end funds, open-end mutual funds have lower fees than closed-end ones because they don't have to pay commissions when buying and selling their shares too. Open-end mutual funds are also more flexible than closed-end ones because they can issue new shares or redeem old ones at any time during the life of the fund. Closed-end funds typically trade at a discount to their net asset value (NAV), which is the value calculated by subtracting liabilities from total assets.
