Question

At net asset value (NAV) after the market closed, mutual funds can be bought or sold unselected during normal trading hours, just like a stock. However, unlike stocks, mutual funds are typically bought or sold directly from the appropriate mutual fund.

Explain the process of buying or selling mutual funds at NAV after market hours and discuss the advantages and considerations associated with this approach compared to regular stock trading.

Answer 1

Mutual funds can be bought or sold at NAV after market hours directly from the mutual fund company, providing flexibility for investors. This approach can help avoid price fluctuations and potentially save costs, but investors should consider fees and restrictions.

Step-by-step explanation:

When buying or selling mutual funds at Net Asset Value (NAV) after market hours, investors typically transact directly with the mutual fund company. Unlike stocks, mutual funds are bought or sold unselected during normal trading hours.

One advantage of buying or selling mutual funds at NAV after market hours is that it provides flexibility for investors who may not have time to trade during regular market hours.

Additionally, buying or selling mutual funds at NAV can help investors avoid potential price fluctuations that may occur during regular trading hours, leading to potential cost savings. However, it's important for investors to carefully consider any potential fees or restrictions associated with buying or selling mutual funds at NAV after market hours.