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In the first week, you learned about one possible source of limits to arbitrage -- fundamental risk. What do you think would happen to a
In the first week, you learned about one possible source of limits to arbitrage -- fundamental risk. What do you think would happen to a closed-end fund's discount if the fund announced that it would liquidate in six months when it will distribute the NAV to its shareholders? How does that announcement affect the fundamental risk of an arbitrageur that tries to exploit the closed-end fund discount?
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