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SIE: Investment Companies & Packaged Products
SIE practice questionmediumClosed-End Funds

How does the number of outstanding shares in a closed-end fund generally change over time?

  1. AIt decreases when investors redeem shares.
  2. BIt increases as new investors enter the fund.
  3. CIt remains fixed after the initial public offering (IPO).✓ Correct answer
  4. DIt fluctuates based on daily NAV changes.
Explanation

Why CIt remains fixed after the initial public offering (IPO).

Closed-end funds issue a fixed number of shares at IPO; share count does not change with market activity or NAV fluctuations.

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