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How are CEFs taxed?
The tax implications for CEF investors can vary based on the type of income the fund generates and how the investor holds the fund (e.g., in a taxable account vs. a tax-advantaged account). It's recommended to consult with a tax advisor to understand ...
What are the risks associated with CEFs?
Investing in CEFs involves risks similar to those of other securities, including market volatility, interest rate risk, and the risk associated with the underlying assets. Additionally, the possibility of shares trading at a discount to NAV can add ...
Are there any fees associated with CEFs?
CEFs may charge management fees and other expenses, which can vary by fund. Additionally, when buying or selling shares on the stock exchange, you may incur brokerage commissions.
Can I sell my CEF shares at any time?
Yes, since CEF shares are traded on the stock exchange, you can buy or sell shares at any time during trading hours at the current market price.
How are CEFs priced?
The market price of a CEF is determined by supply and demand in the market and can differ from the fund's NAV. This difference can result in the fund trading at a premium (price above NAV) or a discount (price below NAV).