SIE practice questionmediumMutual Funds - Redemption
A client redeems shares in an open-end mutual fund. When is the price set for the redemption?
- AAt a price negotiated between buyer and seller
- BAt the previous day's closing price
- CAt the next calculated NAV after the order is received✓ Correct answer
- DAt the daily market high
Explanation
Why C — At the next calculated NAV after the order is received
Redemptions are processed at the next computed NAV after the fund receives the request (forward pricing). Previous prices and negotiation do not apply.
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