CFA Practice Question
Open-end investment companies
A. do not typically sell shares after their initial public offerings.
B. will repurchase shares at their NAVs.
C. have shares that tend to be priced at a discount to their NAVs.
Explanation: Open-end investment companies (also known as mutual funds) continue to sell and repurchase shares after their initial public offerings. They do so at the current NAVs, sometimes with sales or redemption fees.
User Contributed Comments 2
| User | Comment |
|---|---|
| chandsingh | I thought due to the fees, they are buying the shares at a slight discount? |
| asalonga7 | if its a front end load then when they buy them back you get the NAV - not everything is back loaded |