A legal document that provides full disclosure of all information investors need to make a sound decision about an investment. Financial institutions file prospectuses with the Securities and Exchange Commission (SEC).
The option to reinvest cash dividends by purchasing additional shares or fractional shares on the dividend payment date.
A fund with a fixed number of shares outstanding, and one which does not redeem shares the way a typical mutual fund does. Closed-end funds behave more like stock than open-end funds: closed-end funds issue a fixed number of shares to the public in an initial public offering, after which time shares in the fund are bought and sold on a stock exchange, and they are not obligated to issue new shares or redeem outstanding shares as open-end funds are. The price of a share in a closed-end fund is determined entirely by market demand, so shares can either trade below their net asset value ("at a discount") or above it ("at a premium").
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