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Liquidating a fund

If there is a surplus after payment of all creditors, this is distributed pro rata amongst the shareholders of the company. As investment funds continue to face challenges in meeting performance benchmarks and as investors become less tolerant of paying management fees for underperformance, many fund managers are determining that liquidating their funds is the best course of action.As a result, questions concerning the implementation of the Financial Accounting Standards Board (FASB)accounting and financial reporting guidance on adopting the liquidation basis of accounting are becoming more frequent.

If there are insufficient funds to pay all creditors (INSOLVENCY), preferential creditors are paid first (for example the INLAND REVENUE for tax due), then ordinary creditors pro rata.

Any transaction that offsets or closes out a long or short position. Liquidation also refers to a situation in which a company ceases operations and sells as many assets as it can; the company uses the cash to repay debt and, if possible, shareholders.

Liquidation often has a negative connotation for this reason. Case Study If eliminating dividends, laying off employees, selling subsidiaries, restructuring debt, and, finally, reorganization under Chapter 11 bankruptcy fail to resuscitate a business, the likely outcome is liquidation.

You’ll just want to be careful if that particular fund is part of a hedging strategy, which means it will no longer be working in your favor.

Fortunately, there are now more ETF choices than ever to replace closed funds, and one of the best places to look for an alternative fund is our comprehensive lists of different types of ETFs.


  1. Definition of liquidation in the Financial Dictionary - by Free online English dictionary and encyclopedia. What is liquidation? Meaning of liquidation as a finance term. If there are insufficient funds to pay all creditors INSOLVENCY, preferential creditors are paid first for example the INLAND REVENUE for tax due, then.

  2. Dec 1, 2017. OppenheimerFunds will liquidate 9 funds in 2018 as part of a broad product review aimed at maintaining a portfolio of offerings tailored to meet the evolving needs of our clients. These Funds have not grown assets sufficiently to provide investors with meaningful economies of scale, and we believe there is.

  3. Oct 17, 2017. A federal court has turned over management of a troubled investment fund run by CEI in Brunswick to the U. S. Small Business Administration. Maine news, sports, politics, election results, and obituaries from the Bangor Daily News.

  4. Dec 4, 2017. OppenheimerFunds is to close and wind down nine funds, all which are small in terms of assets and have broadly lagged their peer groups over the last three years.

  5. Jun 5, 2017. As great as it is to see more and more innovative ETFs being brought to market now more than ever, there is always survival of the fittest at play and some exchange-traded funds do get delisted. Whether it be for lack of interest or another reason, some ETFs will have to be taken off the market.

  6. Jun 15, 2017. NEW YORK, June 15, 2017 GLOBE NEWSWIRE -- Korea Equity Fund, Inc. NYSEKEF the “Fund” announced that it declared distributions to its shareholders in connection with the dissolution and liquidation of the Fund to comply with the diversification requirements of Subchapter M of the Internal.

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