The Proactive Investor: Finding an Investment Firm

by David Jenyns on September 12, 2008

Finding an investment firm is easy. An old fund has a record. The average selling charge or “load” is 8 to 8.5 percent of the net asset value per share. The management fee is an annual cost, whereas the selling commission is charged only when the shares are bought. The standard management fee is .5 percent of the assets annually. The fund usually pays the fee in quarterly portions. 6. Is the rate of the management fee reduced as the size of the fund grows?

A number of funds have adopted this practice for some years.

7. What type of fund is it?

8. What is the fund’s objective?

The investor should also examine the dividend return on the average price, exclusive of capital gains distributions.

Investors can’t be shy about demanding information on investment companies.

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