Wednesday, December 29, 2010

Front-end Load

A front-end load is an initial sales charge that can range from 2% up to a whopping 8.5%. The fee is generally charged in order to pay brokers and sales people their commission as an incentive for getting people to invest. In mutual funds this fee structure usually applies to "A-Shares". Front-end loads will be charged on initial investments, and may also apply to subsequent investments as well as reinvestment of income and capital gain distributions.

Synonyms: Front-end sales charge, Sales fee, Entry fee, Upfront sales charge

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