Anomalies
Closed-End Mutual Funds
Bibliographic Data
| ID | 4029121 |
|---|---|
| Authors | Charles M C Lee (0000-0002-9978-6044, University of Michigan), Andrei Shleifer (University of Chicago), Richard H Thaler (0000-0001-7550-2855, Cornell University) |
| Year | 1990 |
| Volume | 4 |
| Issue | 4 |
| Pages | 153-164 |
| Publication date | 1990-11-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Journal of Economic Perspectives (JOURNAL) |
| Journal identifiers | ISSN: 0895-3309 • E-ISSN: 1944-7965 |
| Publisher | American Economic Association (PUBLISHER • US) |
| DOI | 10.1257/jep.4.4.153 |
| OpenAlex | W2142676480 |
| Language | EN |
| Citations received | 5 |
| References cited | 13 |
The pricing of closed-end funds presents several puzzles. The following are the four sets of facts that any theory of closed-end fund pricing must address. 1) New funds appear on the market at a premium and move rapidly to a discount. 2) Closed-end funds usually trade at substantial discounts relative to their net asset values. 3) Discounts (and premia) are subject to wide variation, both over time and across funds. 4) When closed-end funds are terminated, either through merger, liquidation, or conversion to an open-end fund, prices converge to reported net asset value. These four puzzles raise basic questions about the operation of financial markets. How can prices diverge from fundamental values? Why don't the forces of arbitrage drive prices back in line? These are the questions we will try to address in this column
Arbitrage · Business · Capital asset pricing model · Closed-end fund · Economics · Financial economics · Institutional investor · Market liquidity · Monetary economics · Mutual fund · Net asset value · Open-end fund · Banking stability, regulation, efficiency · Financial Markets and Investment Strategies · Housing Market and Economics · Finance
| Unique citing works | 5 |
|---|---|
| Citations per year | 0,14 |
| Citation span | 1990 - 2025 (36) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 4 |