Which statement is true regarding UITFs and Mutual Funds?

The selected answer accurately reflects the nature of both UITFs (Unit Investment Trust Funds) and mutual funds. Both types of investment vehicles can indeed be categorized as open-ended or closed-ended funds, depending on their structure and the specifics of how they are managed and traded.

Open-ended funds allow investors to buy and redeem shares at the net asset value (NAV) at any time, providing liquidity and accessibility. In contrast, closed-ended funds issue a fixed number of shares that trade on an exchange, allowing investors to buy and sell shares in the secondary market, often at prices that differ from the NAV. This flexibility is characteristic of both UITFs and mutual funds, placing them in a similar regulatory and operational framework.

The other options present distinctions that do not apply universally to UITFs and mutual funds. They are not primarily associated exclusively with closed-ended structures, they are not limited to fixed-income investments—both can include a variety of asset classes—and both are subject to regulatory oversight, ensuring that they adhere to rules designed to protect investors. This regulatory framework is essential for maintaining market integrity and investor confidence in these financial products.