Many closed-ended funds trade at a discount, meaning the share price may be lower than the net asset value of the fund, in which case an investor may see a gain in a relatively short period of time. If the share price at any given moment is more than the net asset value of the shares in the fund, the investor may pay a premium to invest in the fund. But if the closed-ended fund generates many trades in order to outperform some benchmark, the investor may have to pay higher fees and capital gains taxes if the investments are not in some form of retirement account.