Front-end: A certain percentage is deducted from
each payment into the fund to pay for commissions. The rate
varies and can be negotiated. Rates between 4% and 6% are
not uncommon.
Back-end: You pay the sales charge when you sell
the fund. If you keep the fund long enough (usually 7 years)
there are no charges. If you sell before the 7 years are
up you pay based on a sliding scale; e.g.: first year 4%,
Second year 31/2%, etc.
No-load: No sales charges when you go in or go out.
You still do pay a management and administrative expense
fee.
Management and administrative expense fee: No escaping
these charges. They are usually combined and expressed as
a ratio referred to as Management Expense Ratio (MER). The
range is usually between 1% and 3%.
