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    What is the net asset value of the fund?

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    The New Pioneer closed-end fund has 520 million in securities, 5 million in liabilities and 10 million shares outstanding. It trades at a 5% premium above its net asset value (NAV):
    ? (a) What is the NAV of the fund?
    ? (b) What is the current price of the fund?
    ? (c) Why might a fund trade at a premium above its NAV?

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    Solution Preview

    Hi there,

    Net Asset Value (NAV) is calculated by the following formula:
    NAV = Value of investment - liabilities / # of shares outstanding
    Thus, the answer in for question (a) is:
    NAV = ...

    Solution Summary

    The expert examines the net asset value of a fund.