WordNet-Online
Free dictionary and thesaurus of English. Definitions, synonyms, antonyms and more...
Hint: double-click any word to get it searched!

	Enter your search terms Submit search form
	Web www.wordnet-online.com

Definitions from WordNet

Definitions from the Web

Closed-end fund

Definition:

A closed-end fund is a type of investment fund that raises a fixed amount of capital through an initial public offering (IPO) and then closes to new investors. It is structured as a publicly-traded investment company with a fixed number of shares.

Sense 1 - Investment Fund:

As an investment fund, a closed-end fund pools money from multiple investors to invest in various securities such as stocks, bonds, or other assets. Unlike open-end funds, closed-end funds issue a fixed number of shares to investors, which are then traded on stock exchanges like regular stocks or bonds.

Example sentence 1: The closed-end fund focuses on investing in emerging market stocks.

Example sentence 2: Investors can diversify their portfolios by investing in a closed-end fund that focuses on real estate.

Sense 2 - IPO and Closure:

Closed-end funds are launched through an initial public offering (IPO), where a fixed number of shares are offered to the public for purchase. Once the IPO is completed, the closed-end fund closes to new investors, meaning no additional shares can be created or sold by the fund itself.

Example sentence 1: The closed-end fund's IPO attracted significant interest from investors who were seeking alternative investment options.

Example sentence 2: After the closing date, the fund will not allow any new investors to join.

Sense 3 - Publicly-Traded Investment Company:

Closed-end funds are structured as publicly-traded investment companies, which means their shares can be bought and sold by investors on stock exchanges at market prices. The market price of the shares may trade either at a premium or a discount to the fund's net asset value (NAV).

Example sentence 1: The closed-end fund's shares were trading at a premium due to high demand from investors looking for income-generating assets.

Example sentence 2: Investors can monitor the closed-end fund's performance by tracking its share price fluctuations on the stock exchange.