Define: Closed-end Fund

UK Accounting Glossary

Definition: Closed-end Fund



What is the dictionary definition of Closed-end Fund?

Dictionary Definition


A Closed-End fund is one with a limited number of shares. No new shares are issued after the fund is launched. An investor can purchase shares in a closed-end fund from a broker. The price of a closed-end fund is determined by the premium (or discount) placed on it by the market. ETFs, or exchange-traded funds, make up a subset of closed-end funds.


Advertisement



Full Definition of Closed-end Fund


A closed-end fund is legally known as a closed-end management company. A closed-end fund issues a fixed number of shares, usually through a one-time public offering, after which timeshares in the closed-end fund are traded on a stock exchange, and not directly from the fund. A closed-end fund differs from a mutual (open-end) fund, which continuously issues new shares. A closed-end fund also differs from a mutual fund in that it may issue senior securities such as preferred stocks or bonds. The price of a share in a closed-end fund is determined entirely by the market and is not directly related to the NAV per share. Shares of a closed-end fund may sell at a discount or premium to the NAV. The process of buying or selling shares of a closed-end fund is identical to the purchase or sale of any other listed stock. Closed-end mutual funds are actively managed.


Advertisement




Cite Term


To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
https://payrollheaven.com/define/closed-end-fund/
Modern Language Association (MLA):
Closed-end Fund. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. March 30, 2020 https://payrollheaven.com/define/closed-end-fund/.
Chicago Manual of Style (CMS):
Closed-end Fund. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/closed-end-fund/ (accessed: March 30, 2020).
American Psychological Association (APA):
Closed-end Fund. PayrollHeaven.com. Retrieved March 30, 2020, from PayrollHeaven.com website: https://payrollheaven.com/define/closed-end-fund/

Definition Sources


Definitions for Closed-end Fund are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 4th February 2020.