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What is the effect of a failed auction on the funds investments and the funds common shareholders?

April 26, 2017auction common failed fund investments Shareholders

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What is the effect of a failed auction on the funds investments and the funds common shareholders?

1 Answer

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Failed auctions do not directly affect the portfolio securities held by funds or the ability of common shareholders to sell their stock. As the cost of leverage increases, however, the fund’s current earnings may decline.