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Closed-end funds

Key concepts of closed-end funds

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Key Benefits

Closed-end funds have long been valued for the potential to provide attractive income. Since launching its first closed-end fund in 1987, Nuveen has led the way in new structures, forms of leverage, education, and support.

What is a closed-end fund?

A closed-end fund is a publicly traded investment company that invests in a variety of securities, like stocks and bonds. The fund raises capital primarily through an initial public offering (IPO), and CEF shares and the proceeds are invested according to the fund's investment objectives.

After the IPO, a closed-end fund is listed on a national exchange, where shares can readily be bought from or sold to other investors throughout the trading day, much like a stock. The market price of a closed-end fund is determined by market supply and demand and can change throughout the day.

These four concepts are key to understanding the value of closed-end funds:


Key concept of Closed end funds
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It is important to consider the objectives, risks, charges and expenses of any fund before investing. Investing in closed-end funds involves risk; principal loss is possible. There is no guarantee a fund’s investment objective will be achieved. Closed-end fund shares may frequently trade at a discount or premium to their net asset value (NAV).
Closed-end fund historical distribution sources include net investment income, realized gains, and return of capital. Leverage increases return volatility and magnifies a fund’s potential return whether that return is positive or negative. There is no guarantee a fund’s leveraging strategy will be successful. All investments carry a certain degree of risk and there is no assurance that an investment will provide positive performance over any period of time.

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