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1 Jul 2018

7. Suppose you would like to invest $5000 into a mutual fund for three years. The following 3 mutual fund all have an expected annual return of 12% but with different fee structures. Which mutual fund would you like to purchase? Hint: make sure that you understand clearly the fee structures of mutual funds.

FUND A FUND B FUND C
FRONT END LOAD 2% 3% 0
BACK END LOAD 2% if redeem within 1 year; 0% otherwise 0 3%
OPERATING EXPENSE RATIO 1.25% 1.75% 1.5%
12B-1 .75% .5% .5%

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Trinidad Tremblay
Trinidad TremblayLv2
3 Jul 2018

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