The Law Offices of Robert Wayne Pearce P.A. handles Closed-end Bond Fund cases throughout the United States and within Puerto Rico. A closed-end bond fund is a publicly traded investment company that raises a fixed amount of capital through an initial public offering (IPO) to purchase and hold bonds for a certain period. The closed end fund is structured, listed and traded like a stock, usually on a major stock exchange. Many investors confuse closed-end bond funds with the more traditional open-end mutual funds. Attorney Pearce will explain the differences: once the fund begins operating, a closed-end bond fund is closed to new capital; closed-end bond fund shares trade on a stock exchange rather than being redeemed directly by the fund; shares of a closed-end bond fund can be purchased or sold throughout the day as opposed to an open-end fund that can be traded only at the closing price at the end of the market day; closed-end bond funds often sell at a premium or discount to net asset value, but an open-end fund sells at its net asset value; and closed-end bond funds can own a greater amount of illiquid investments than open-end funds.
Representing clients throughout Florida and nationwide.
Brokerage firms often omit disclosing the risks associated with closed-end bond funds. Here are some of the important facts that brokerage firms have neglected to inform investors: The first 5% of the investors’ money in a closed-end IPO goes straight into the pocket of the people selling the fund as a commission; closed-end bond funds are not actively managed, meaning the bonds are held to a certain date and sold at the prevailing price with either gains or losses; closed-end shares usually trade for less than their net asset value because brokerage firms deliberately sell these IPOs at the market’s peak when enthusiasm runs high and the shares are poised to fall; and shares of closed-end bond IPOs are incredibly volatile. So why are investors still being steered by their brokers to closed-end bond funds, particularly those in an IPO? It’s the commissions!
For more information about Closed-end Bond Funds and our cases and investigations, click on the links below:
FREE INITIAL CONSULTATION WITH CLOSED-END BOND FUND INVESTMENT DISPUTE ATTORNEYS
The Law Offices of Robert Wayne Pearce, P.A. understands what is at stake in closed-end investment law matters and constantly strives to secure the most favorable possible result. Attorney Pearce provides a complete review of your case and fully explains your legal options when are sold misrepresented and/or unsuitable closed-end bond funds. The firm works to ensure that you have all of the information necessary to make a sound decision before any action is taken in your case.
For dedicated representation by a law firm with substantial experience in all kinds of securities, commodities and investment disputes, contact the firm by telephone at 561-338-0037 or toll free at 800-732-2889 or via e-mail.
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