Question

What are the different between mutual fund、close-end fund and private fund？elaborate and provide examples for each category.

Answer 1

MUTUAL FUND-

A mutual fund refers to the professionally managed financial vehicle made up of a pool of money collected from many investors. Mutual funds invest in securities like stocks, bonds, money market instruments, and other assets. A mutual fund's portfolio is structured and maintained to match the investment objectives stated in its prospectus.

For Example- TATA Equity PE fund, SBI Index Nifty fund etc

CLOSE END FUND-

Closed end fund is a type of fund that raises money through an initial public offering (IPO) and then lists shares for trade on a stock exchange.

Closed-end fund also has a professional manager overseeing the portfolio. It trades like equity, as its price fluctuates throughout the trading day. However, after the IPO the closed end fund can only be traded through the secondary market.

For example - Gabelli Equity trust, Tri continental corporation.

PRIVATE FUND-

Private investment fund refers to an investment company that does not raise capital from retail investors or the general public. Members of a private investment company have deep knowledge of the industry as well as investments elsewhere. For a private investment the regulatory and legal requirements are much lower than what is required for funds that are traded publicly.

For example - Blackstone, Apax etc