Management Companies: Open-end Funds
Open-end management companies are what most people know as mutual funds. Mutual funds offer shares of a portfolio of securities in the form of a fund to the public. Every time shares in the fund are purchased, the shares are issued new by the mutual fund company. Additionally, when shareholders wish to sell their shares, they must sell them back to the mutual fund company. The mutual fund company will then “redeem” them and expire the shares. Thus, open-end funds offer a continuous issuance of new shares, and because the shares are issued new, they will always need to be sold with a prospectus.
Mutual fund share