With so many different investments to choose from, it can be hard to know all of them. But with some little-known investments like closed-end funds, the opportunity comes from most people's complete unfamiliarity with them.
In the following video, Dan Caplinger, The Motley Fool's director of investment planning, looks at how closed-end funds work. Dan notes that unlike regular mutual funds, closed-end funds have mixed numbers of shares, allowing them to trade at discounts to the value of their underlying assets from time to time. Dan explains how well-known managers Franklin Templeton (NYSE: BEN), Eaton Vance (NYSE: EV), and AllianceBernstein (NYSE: AB), as well as PIMCO and Nuveen, use closed-end funds to ensure a solid base of assets under management without worrying about redemptions. Dan recommends looking at liquidity and fees in order to separate out the best closed-end funds from the rest.
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