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An investment company that pools money from many investors to purchase a portfolio of investments.
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A mutual fund with shares that trade on a stock exchange like any other stock. The fund's sponsor can usually repurchase units and sell the constituent parts or buy the constituent parts of the fund and issue new units to maintain a very close correspondence between the price of the underlying assets (Net Asset Value) and the market price.
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Closed End Fund
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A closed end fund is similar to an exchange traded fund except that there are usually a fixed number of shares. Since the number of shares is fixed the market price may be less than the net asset value and the fund trades at a discount or the market price may exceed the net asset value and the fund trades at a premium.
An interval fund is a type of closed end fund in which the fund sponsor repurchases a certain percentage of outstanding shares at regular intervals to allow shareholders to exit the fund and keep the fund from trading at a large discount.
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