OTHER FEES CHARGED BY NO-LOAD FUNDS
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"No-load" does not mean "no fee." No-load funds may charge fees
other than sales charges. Some of these fees make up for the lack of sales
Below are some of the other fees a no-load fund may charge:
? Maintenance fee?This fee covers the
costs of maintaining accounts. It covers dividend statements and periodic
reports, among other things. Most maintenance fees are $10 per year.
? Transaction fee?This fee covers the costs of
investing the money in securities for the fund.
? Management fee?This fee is charged to compensate
those who run the fund's portfolio. It rarely exceeds one percent of the fund's
? 12b-1 fees?These fees cover marketing, advertising,
and distribution costs. They are called "hidden loads" by many, because they
cover some costs that sales loads normally cover.
? Redemption fee?This is a charge imposed when
investors sell shares back to the fund. Other names for these charges are
back-end loads, exit fees, and deferred sales loads. True
no-load funds do not charge redemption fees, because these fees are technically
Before you choose a fund based on sales charges, you
should know what each one offers you. On the next page, we will discuss