Understanding the Costs Involved in Mutual Fund Investments
The following table presents information on four different open-end mutual funds for questions 1-6. Use the information in the table to answer the six questions that follow.
| FUND | NAV | NET CHG | YTD % RET |
|---|---|---|---|
| QtrF p | 13.32 | 0.04 | 3.1 |
| TmRE r | 20.77 | 0.14 | 6.0 |
| MRGG | 29.81 | 0.28 | 8.5 |
| MajTrk | 44.21 | 0.37 | 9.6 |
A. MajTrk
B. TmRE
C. QtrF
D. MRGG
2. True or False: You can generally expect funds that charge 12b-1 fees to outperform funds that do not charge these fees.
A. True
B. False
3. Suppose MajTrk has a front-end load fee of 7%. If you purchase 100 shares of this fund at the NAV, you will pay a commission of __?__.
4. If, in one month, you sell the shares, you ___ pay a redemption fee at that time.
A. WILL ALSO
B. WILL NOT
5. If you are interested only in funds without any fee, you ( A. WILL NEED , B. WILL ALSO) to use additional online resources to find no-load funds, because using only the quotations as listed in the table, it is 6. ( A. VERY EASY, B. IMPOSSIBLY) to determine the amount of any front-end load fee that the fund may charge.