A closed-end fund is a type of investment fund that raises a fixed amount of capital through an IPO, issues a set number of shares, and then trades on a stock exchange like a stock. Unlike mutual funds or ETFs, closed-end funds don't issue new shares or redeem shares on demand — investors buy and sell them on the open market. This means a closed-end fund's market price can trade at a premium or discount to its net asset value (NAV). Many closed-end funds use leverage and focus on income generation through bonds, dividends, or alternative assets.