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do we need to remember fee of investment funds

I have summarized fee for investment funds. Let me know if you find it is not accurate. Do we need to remember these values?

1. Annual management fee for professional managers is 1/4% to 1% of average net assets of funds. (I saw conflicting statement that rage is 1/4% to 1/2%)

2. For load funds sales fee is typically 7.5 to 8% of NAV, but generally do not charge
redemption fee

3. Some no-load funds charge redumption fee about half percent of NAV

4. Low-load open-end funds charges sales fee of about 3% of NAV

5. 12b-1 plan allows funds to deduct as much as 1.25% of average net assets per year to
cover distribution costs such as advertising, broker’s commissions and marketing expenses.
(I found conflicting range as 0.25 to 1% )

6. Shares of closed-end investment company trade at 5 to 20% discount to NAV

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I don’t think we need to remember those numbers.

chinni, I recall having to define various types of fees, the types of funds to which they were applicable, and having to explain the implications for investors, but not actually needing to know the typical range or value of the fees.

I don’t have access to the current LI curriculum, but if you reprint the LOS surrounding these figures, it’ll be easier to answer your question.

You don’t need to know the typical fees that are charged. I do think you need to know the basic calculation of return you get from a fund after fees. The formula I remember just off the top of my head is (not sure if its right correct me if I am wrong):

(1-front end load)(Fund return-12b1 fees-management fees)(1-back end load)

Also, closed end funds can trade at a premium to NAV too.

I found lot of questions in Alternative assets section of schweser queston bank material that needs these percentages. I am glad that we don’t need to remember these.

Thanks for your replies.

Not sure where you are getting some of those numbers for.

I think we should clarify the country source in our discussions.

In US, typically the Equity Front Load is 5.75% and goes down with different breakpoints. Bond Front Loads are slightly lower usually. Around 4.75%.

12b-1 is typically 0.25%. It could be higher, but I have seen this most of the time.

Also, management expenses are typically 0.75% and up. I have seen as high as 2.20% on International funds.

Just a FYI. I doubt we would have to remember that since every company uses different pricing.