What is a managed pool of securities that is traded on a stock exchange and has a fixed number of shares?

A managed pool of securities that is traded on a stock exchange and has a fixed number of shares is best identified as a closed-end fund. Closed-end funds raise a fixed amount of capital through an initial public offering (IPO) and issue a set number of shares. After the IPO, the shares are traded on a stock exchange, but unlike open-end funds, the number of shares does not change based on investor demand. This means that the market price of the shares can fluctuate based on supply and demand, potentially trading at a premium or discount to the net asset value (NAV) of the underlying securities.

Closed-end funds often invest in a diversified portfolio of assets and are typically managed by investment professionals. This structure provides investors with the ability to buy and sell shares on the stock exchange just like stocks. Understanding the nature and characteristics of closed-end funds is important for distinguishing them from other investment vehicles like open-end funds, which continuously issue and redeem shares based on investor transactions, and exchange-traded funds (ETFs), which can combine features of both open-end and closed-end funds but generally offer continuous trading like stocks. Hedge funds, on the other hand, have different investment strategies, are typically less regulated, and are not necessarily traded on stock exchanges.