Respuesta :
Closed-end mutual funds can trade at either a discount or a premium to their net asset values (navs). This statement is a true statement.
Can closed-end mutual funds be traded?
The closed-end funds are listed on a stock exchange when the money is raised, allowing its units to be traded just like any other stock on the board. Investors can redeem their units when the closed-end mutual fund scheme has ended and the fixed-duration period has passed.
Why do closed-end funds trade at a premium or a discount to their net asset value?
The market will set the price of the units because closed-end funds are traded on a public exchange. Due to this, the price may occasionally trade at a premium or a discount to the NAV as indicated. The share price and NAV ought to converge in the longer run.
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