Open-ended mutual funds and closed-ended mutual funds are two primary types of investment funds that pool money from investors to invest in a diversified portfolio of securities, such as stocks, bonds, or other financial instruments, managed by professional portfolio managers. The main difference between open-ended and closed-ended mutual funds lies in their structure, operation, and liquidity. Open-ended mutual funds issue and redeem shares on demand at their net asset value (NAV), allowing investors to buy or sell fund shares at any time directly from the fund company or through intermediaries, such as brokerage firms or financial advisors. Open-ended funds continuously adjust their portfolio holdings to accommodate investor redemptions and purchases, maintaining a flexible and dynamic investment strategy. Closed-ended mutual funds issue a fixed number of shares through an initial public offering (IPO) and trade on stock exchanges like individual stocks, with their prices determined by supply and demand in the secondary market. Closed-ended funds do not issue new shares or redeem existing shares directly from the fund company, limiting their liquidity and potentially leading to trading at a premium or discount to their NAV. Both open-ended and closed-ended mutual funds offer investors opportunities for diversification, professional management, and investment exposure to various asset classes and market segments, with each type catering to different investor preferences, objectives, and risk profiles.