Open-end mutual fund

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Open-End Mutual Fund

A mutual fund in which the number of shares may be increased or decreased depending on the amount of money invested in the company. This means that the fund's capitalization is not fixed and changes upon the demand of shareholders. In other words, an open-end mutual fund issues new stock when people invest in it and buys back old shares when investors want to be rid of them. The latter is referred to as redeeming one's share of the mutual fund. The value of each share is the net portfolio value divided by the number of shares. In the United Kingdom, this investment vehicle is usually called an open-end investment company.

Open-end mutual fund.

Most mutual funds are open-end funds. This means they issue and redeem shares on a continuous basis, and grow or shrink in response to investor demand for their shares.

Open-end mutual funds trade at their net asset value (NAV), and if the fund has a front-end sales charge, that sales charge is added to the NAV to determine the selling price.

NAV is the value of the fund's investments, plus money awaiting investment, minus operating expenses, divided by the number of outstanding shares.

An open-end fund is the opposite of a closed-end fund, which issues shares only once. After selling its initial shares, a closed-end fund is listed on a securities market and trades like stock. The sponsor of the fund is not involved in those transactions.

However, an open-end fund may be closed to new investors at the discretion of the fund management, usually because the fund has grown very large.

References in periodicals archive ?
Further, the company said that net inflows for open-end funds and institutional accounts were USD255m and USD211m, respectively; distributions for institutional sub-advisory, closed-end funds and open-end funds were USD283m, USD40m and USD32m, respectively; and a transfer of USD47m was recorded from open-end funds to institutional accounts.
Distributions for institutional subadvisory, open-end funds and closed-end funds were USD288 million, USD101 million and USD109 million, respectively.
8 million in selected open-end funds managed by the Company.
The Germans are in a bit of denial I think because they expect the open-end funds will get pasted back together and survive," Zoukis said.
A new German financial services law that took effect in July permits so-called open-end funds to increase their investments in commercial properties in the United States and allows for increased activities by German commercial mortgage banks in the United States.
Unlike open-end funds, closed-ends don't issue and redeem shares on a continuous basis.
Distributions for institutional subadvisory, open-end funds, and closed-end funds were USD240 million, USD27 million and USD7.
Closed-end funds, unlike open-end funds, are not continuously offered.
In recommending against the conversion of Putnam High Income Securities Fund, Putnam Master Intermediate Income Trust and Putnam Premier Income Trust to open-end funds, the Trustees considered, among other factors, their belief that the closed-end structure affords the funds and their investors potential investment advantages not available to open-end funds.
TM) is a Denver-based outsourcing solution for administration, fund accounting, legal, marketing, tax, transfer agency and shareholder services for open-end funds, closed-end funds and exchange-traded funds.
In making this recommendation, the Trustees considered, among other factors, their belief that the closed-end structure affords these funds and their investors potential investment advantages not available to open-end funds.