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13 August, 22:07

The Stone Harbor Fund is a closed-end investment company with a portfolio currently worth $430 million. It has liabilities of $8 million and 10 million shares outstanding. If the fund sells for $40 a share, what is its premium or discount as a percent of NAV

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  1. 13 August, 22:10
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    5.21%

    Explanation:

    The Stone Harbor Fund

    NAV = Investment in portfolio - liabilities / Numbers of share outstanding

    (430-8) / 10

    =422/10

    =$42.2

    Discount will be : $42.2 - 40 shares

    =$2.2

    Hence:

    $2.2/$42.2

    =5.21%

    Therefore the premium or discount as a percent of NAV will be 5.21%
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