Investing in CEFs: The Rewards
Description
This article is from the A Guide to Closed-End Funds (CEFs).
Investing in CEFs: The Rewards
The Basics
Investing in closed-end funds (CEFs), while undoubtedly exciting, can also be very rewarding. Apart from just hoping that the underlying markets in which the CEF has invested will perform well, a CEF investor who has done his homework can often dramatically outperform the market, sometimes with reduced risk. Such results depend on one of the principal characteristics of CEFs: they sometimes trade at a discount and sometimes at a premium to the NAV.
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