Closed-End Investment Companies: Characteristics, Exam Question, Test Prep

Characteristics of a Closed-End Investment Company

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Question

What is not a characteristic of a closed-end investment company?

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Explanations

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A. B. C. D. E.

D

The market price is determined by the relative supply and demand for the investment company stock in the public secondary market. When trading these shares an investor will pay or receive this market price plus or minus a commission. The market price has historically been 5 to 20 percent below the NAV.