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Get a Closer Look at Closed-End Funds
By Daniel Schrass
July 30, 2013
ICI has recently updated several of its key closed-end funds resources. Closed-end funds are a type of investment company that generally issues a fixed number of shares that are listed on a stock exchange or traded in the over-the-counter market. Ranging from the basics to more-complex topics, the resources should be helpful for anyone interested in these funds:
- A Guide to Closed-End Funds: What are the features of closed-end funds? How do they calculate the value of their portfolios? This guide answers these questions and more.
- Frequently Asked Questions About Closed-End Funds and Their Use of Leverage: These FAQs delve into “leveraging,” the practice whereby a closed-end fund raises additional capital, which it can use to buy more securities for its portfolio. This strategy is intended to allow the fund to produce higher returns for its common shareholders over the long term.
Closed-End Fund Assets: Recent Trends
Don’t forget ICI’s recent report on closed-end funds, which goes into detail on the closed-end fund market, the funds themselves, and the characteristics of their investors.
As the report indicates, total closed-end fund assets were $264 billion at year-end 2012, up 9 percent from year-end 2011.
Closed-End Fund Total Net Assets Increased to $264 Billion at Year-End 2012
Closed-end fund total net assets by investment objective; billions of dollars; year-end; 2002–2011, 2012:Q1–2012:Q4
Note: Components may not add to the total because of rounding. Data reflect revisions to previously reported data.
Source: Investment Company Institute
Visit our Closed-End Fund Resource Center to find the report and other useful information.
Daniel Schrass is an associate economist at ICI.
TOPICS: Investor ResearchInvestment Education
Check the Facts: Funds Engage Actively on Corporate Governance
By Ianthé Zabel
July 19, 2013
ICI president and CEO Paul Schott Stevens recently sent the following letter to the New York Times:
Every mutual fund or other registered investment company is required by law to cast votes on proxy proposals in the interests of the fund and its investors. Generally, funds interpret this to mean that they should support proposals that will promote good corporate governance and increase the value of the funds’ investments, carefully weighing shareholder interests and fund objectives.
TOPICS: Fund Regulation
Key Points to Remember on Fund Fees
By Sean Collins and Bob Grohowski
July 12, 2013
Over the past two decades, investors have paid less and less to own shares of mutual funds.