EBK INVESTMENTS
11th Edition
ISBN: 9781259357480
Author: Bodie
Publisher: MCGRAW HILL BOOK COMPANY
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Chapter 4, Problem 8PS
Summary Introduction
Adequate information:
Offering price of open ended fund- $ 12.30 per share
Front end load- 5%
To compute:
Net asset value for the given fund
Introduction:
Front end load is the fees charged by the mutual fund companies at the time of issue of the units/shares over and above the net assets value. Front end load is always given as a percentage of the offering price.
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If the offering price of an open-end fund is $12.30 per share and the fund is sold with a front-end load of 5%, what is its net asset value?
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The Closed Fund is a closed-end investment company with a portfolio currently worth $200 million. It has liabilities of $3 million and 5 million shares outstanding.a. What is the NAV of the fund?b. If the fund sells for $36 per share, what is its premium or discount as a percent of net asset value?
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