Closed-end investment companies and exchange-traded funds trade intraday. What are two examples of securities that do not trade intraday?

The correct response identifies Unit Investment Trusts (UITs) and Open-Ended Funds as examples of securities that do not trade intraday. UITs are investment funds that offer a fixed portfolio of securities and are set up for a specific period. They are priced once daily, after the market closes, based on their net asset value (NAV), rather than trading throughout the day like stocks.

Open-Ended Funds, commonly known as mutual funds, also do not trade intraday. They allow investors to buy and redeem shares at the end of the trading day at the NAV price. Unlike closed-end funds and ETFs, which have fluctuating prices throughout the day based on market demand, the price of open-ended funds is determined only once at the end of each trading day.

In contrast, other options include securities that trade continuously during market hours. For instance, common stocks and municipal bonds are actively traded on exchanges, as are corporate bonds and REITs. Penny stocks and blue-chip stocks fluctuate in price throughout the day, depending on market conditions and trading volumes. Thus, the distinction between the trading mechanisms of these securities reinforces why UITs and Open-Ended Funds are appropriately identified as not trading intraday.