Tuesday, December 28, 2010

Back-end Load

A Back-end load is a type of sales fee that is charged when the investor exits the fund. Typically mutual funds that charge this fee will issue "B Shares" for this type of fee structure. This type of charge is also referred to as a Contingent Deferred Sales Charge. Most funds that charge back end loads structure the fee system so that as the years progress the fee percentage decreases, indeed for most fund managers this fee reduces to zero after 5-8 years. As with all fees you need to do your homework and find out what the fees are and what works for you.

Synonyms: Contingent Deferred Sales Charge, Contingent deferred sales load, Exit fee, Withdrawal fee, Early withdrawal fee

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