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When Bond Prices Are a Matter of Opinion – MorningStar

Full Article: MorningStar

Figuring out what those bonds are worth when they aren’t trading is a huge challenge. Every time an investor purchases or sells shares in a fund, the transaction has to be done based on the value of the whole portfolio. If underlying security prices are higher than they should be, investors selling shares will get more than they’re entitled to, while those buying will wind up paying more, and vice versa.

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