A Contingent Deferred Sales Charge (CDSC) is a fee charged by some mutual fund companies when an investor sells shares of a fund within a specified time period. The fee is typically highest during the first year or two after an investor buys shares, and declines over time until it reaches zero.
The fee is also known as a "back-end load" or "deferred sales charge."
What fees are charged for mutual funds? There are many different types of mutual funds, and each one has its own fee structure. Some mutual funds have a front-end load, which is a fee that is charged when you purchase the fund. Other mutual funds have a back-end load, which is a fee that is charged when you sell the fund. There are also mutual funds that have no load at all. Each type of mutual fund has its own advantages and disadvantages, so it is important to understand the fees before you invest in a fund.
How do I know my CDSC account?
If you have a CDSC account, you should be able to find your account number on your most recent statement. If you can't find your statement, you can contact your broker or mutual fund company and they should be able to help you locate your account number.
How does CDSC work?
CDSC is an acronym that stands for Contingent Deferred Sales Charge. It is a type of fee assessed on mutual fund investments that are sold within a certain time period, typically within five years of purchase. The fee is assessed as a percentage of the sale price, and is generally between 1-5%. CDSC fees are assessed by the fund company in order to discourage investors from selling their shares too soon after purchase, and to recoup some of the costs associated with selling the fund.
What are four types of fees that may appear on your mutual fund statement?
1. Management fees: These are the fees charged by the fund manager in exchange for their services. This is typically a percentage of the assets under management, and will be deducted from the fund's performance.
2. Performance fees: Some fund managers charge a performance fee in addition to the management fee. This is a percentage of the fund's performance, and is typically only charged if the fund outperforms a certain benchmark.
3. Expense ratios: This is the percentage of the fund's assets that are used to cover the costs of running the fund, such as administration, marketing, and custody fees.
4. Loads: Loads are sales charges that are levied when you buy or sell shares in a mutual fund. There are two types of loads: front-end loads, which are charged when you buy shares, and back-end loads, which are charged when you sell shares.
What are the two main fees associated with a mutual fund?
The two main fees associated with a mutual fund are the management fee and the expense ratio.
The management fee is a fee charged by the fund's investment manager for their services. This fee is typically a percentage of the fund's assets, and is paid out of the fund's earnings.
The expense ratio is the total annual operating expense of the fund, expressed as a percentage of the fund's average net assets. This includes the management fee, as well as other expenses such as administrative expenses, marketing expenses, and transaction costs.