Using The Prospectus To Determine Net Asset

by David Jenyns on October 17, 2008

The precise method of determining the net asset value of each share of stock and its offering price is often set forth clearly in the prospectus of management companies. Bid and asked prices are shown. The fact that management-company shares are sold continuously has produced a unique selling mechanism.

Generally, an management company management enters into an agreement with the principal distributor pursuant to which the distributor is granted the exclusive right to distribute the company’s shares. These shares are purchased by the distributor or underwriter at a price, which will net the company an amount equal to the net asset value. A distributor organization may be by-passed if the investment company wishes to sell its shares directly.

Discover Winning Investment Strategies, Tips and Techniques to Guarantee Your Financial Success


Previous post:

Next post: