Examining the Factors that Impact the Discount to Net Asset Value and the Difference in Discount between Different Investment Companies

Abstract: A discount to the net asset value of Swedish investment companies is something that have existed for decades and a general explanation for the cause have not been found. The aim of this thesis is to find the the factors that impact the discount to net asset value of Swedish investment companies. The result will later be used to for comparison to gain a better understanding of the different causes behind the discount and in what way they differ among the companies. This will be done by using regression analysis. The results indicate that unlisted holdings contribute greatly to the discount but can't be used as a general explanation for the discount as investment companies which only hold listed holdings trade at a discount as well. Furthermore when foreign ownership or institutional ownership of the investment companies increase, the discount decreases as it signals to the market that their value is fair.