What does liquidating mean
A fund merger prevents the selling of the entire fund holdings on the open market, and better preserves the fund value for fund shareholders.
But it may be difficult to find a truly compatible fund for the merger.
A business owner may split items among several liquidators to maximize revenue from the liquidation of each item.
Securities that are not widely traded may be hard to sell, especially when a fund dumps its often large holdings at one time.
Fund companies often create a family of funds that each have their own investment objectives and portfolio strategies to meet various investor demands.
Merging a fund with another fund that has a different investment focus may negatively affect shareholders of the fund being liquidated.
A poorly performing fund can become inoperable sometimes as a result of increased shareholder redemption.
A fund that fails to deliver the expected returns will keep losing investors over time.