Economics · Financial Markets
A Close-Ended Mutual Fund (CEMF) differs significantly from an Open-Ended Mutual Fund (OEMF) in terms of liquidity and unit availability. Which statement provides the most accurate description of a CEMF's nature?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1CEMFs have no fixed maturity period and are perpetual in nature.
- 2CEMFs are mandatory for all debt and liquid schemes due to their low risk profile.
- 3The units of a CEMF are listed on a stock exchange and can be bought or sold after the New Fund Offer (NFO) period through the secondary market.✓
- 4CEMFs issue and redeem units on a continuous basis at the prevailing Net Asset Value (NAV).
Correct answer
The units of a CEMF are listed on a stock exchange and can be bought or sold after the New Fund Offer (NFO) period through the secondary market.
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