Question

Investors who wish to liquidate their holdings in a closed-end fund may ___________________.

A. sell their shares back to the fund at a discount if they wish

B. sell their shares back to the fund at net asset value

C. sell their shares on the secondary market

D. sell their shares at a premium to net asset value if they wish

Answer 1

The correct option is C

Step-by-step explanation:

Closed end fund is the fund which is of pooled assets and increases or raise the fixed amount of capital by the procedure of IPO (stands for Initial Public Offering) and then the shares are listed for the purpose of trade on the stock exchange.

When the investors wish to liquidate (means cash), the holdings in fund which is closed end, might sell the shares on the secondary market or open market.