Closed-Ended Mutual Fund

A closed-ended mutual fund is a mutual fund scheme that raises a fixed corpus through a New Fund Offer (NFO) during a specific subscription window and has a predetermined maturity date — after which the fund is wound up and proceeds are returned to investors. Unlike open-ended funds, closed-ended fund units cannot be redeemed directly with the fund house before maturity; instead, units are mandatorily listed on stock exchanges (NSE or BSE) where investors can buy or sell them at market prices, which may trade at a discount or premium to the fund's NAV depending on demand and sentiment. Examples of closed-ended structures in India include Fixed Maturity Plans (FMPs), interval funds, and certain thematic equity funds. For investors on Ventura Securities, closed-ended funds may be relevant when seeking defined-maturity, portfolio-lock-in strategies — particularly FMPs that offer predictable debt returns — but the liquidity discount risk (units trading below NAV on exchanges) must be carefully evaluated before investing, especially for investors who may need access to funds before the maturity date.