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 ?
Through its subsidiaries, the company manages open-end funds, closed-end funds as well as private advisory accounts.
Net Sales Of Worldwide Regulated Open-End Funds (Billions of US dollars)
being managed by HBL AMC into open-end funds. The SECP managed to
ISLAMABAD -- The Securities and Exchange Commission of Pakistan (SECP) has approved the conversion of PICIC Investment Fund and PICIC Growth Fund being managed by HBL AMC into open-end funds. The SECP managed to bring this longstanding issue to a successful conclusion by closely working with HBL AMC and other stakeholders, including PSX, CDC and NCCPL.
Consequently, the PICIC Investment Fund (PIF) and PICIC Growth Fund (PGF) were converted into open-end funds on July 2, 2018, in compliance with the condition imposed by the SECP for the merger of the PICIC AMC with and into HBL AMC.
KARACHI -- The Securities and Exchange Commission of Pakistan (SECP) has approved the conversion of PICIC Investment Fund and PICIC Growth Fund being managed by HBL AMC into open-end funds. The SECP managed to bring this longstanding issue to a successful conclusion by closely working with HBL AMC and other stakeholders, including PSX, CDC, and NCCPL.
GAMCO, through its subsidiaries, manages private advisory accounts (GAMCO Asset Management) and open-end funds and closed-end funds (Gabelli Funds).
Total assets of the open-end funds fell in late December 2014 to e1/41.984 bln from e1/42.105 bln in December 2013, while the assets of closed-end funds declined in December 2014 to e1/4566.8 mln from e1/4611.9 mln in December 2013.
(Al Meezan) declared stock dividends for its five open-end funds in recently held meeting.
"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.