All charges, fees and expenses are outlined in a fund’s prospectus — a legal document that provides detailed information about the fund’s investment strategy, fee structure, and operations. Mutual fund companies are required by law to provide you with a prospectus before you invest. Read it carefully before investing.

• Load vs. no-load funds. The price of most mutual funds includes a sales charge, known as a load, which is used to pay a commission to the broker/dealer or registered representative selling the fund.
• No-load funds are sold without a sales charge. In general, the mutual fund company, without a broker or salesperson as intermediary, sells them directly to you. These funds may, however, charge fees for marketing and administrative costs. Additionally, no-load funds may be subject to online transaction fees/commissions.
• A front-end load is an initial sales charge, usually a percentage of your investment, which is assessed when you purchase shares of the fund. Front-end loads generally range from two percent to eight percent of the amount invested.
•  A back-end load is one charged when you redeem shares. This deferred sales charge decreases each year you hold your shares, typically from five percent in year one to zero percent in year seven or eight and thereafter. The intent is to encourage you to hold your shares longer. Note that while most mutual funds either charge front-end load or a back-end load, some funds charge both, although they tend to be smaller fees.

All mutual funds charge management and administrative fees that are used to pay the salaries of the fund managers and staff; expenses such as telephone and postage costs; and legal costs. More aggressive and actively managed funds carry higher fees than do minimally managed funds such as index funds. International funds typically have higher expenses as a result of the increased cost of doing business in foreign countries. These fees vary. They can be significant; it is wise to consider them when choosing a fund.