Term and target-term funds

A term fund has a stated date on which it intends to liquidate and return NAV to shareholders. A target-term fund additionally aims to return a specific amount — typically the original offering price — but does not guarantee it.

Because a term fund's discount should converge toward zero as the date approaches, term funds trade differently from perpetual CEFs. But the documents matter: many term funds can extend the date, convert to perpetual status by shareholder vote, or offer a tender at NAV instead of liquidating. A “yield to liquidation” that assumes the date and the NAV are fixed is not a number this site computes, because neither is guaranteed.