| Mutual funds pool money from investors who are | | | | shareholders records and financial statements, |
| constantly saving. At the same time, others are | | | | marketing and advertisement fees. As an investor |
| withdrawing, forcing the investment managers to | | | | who is only starting out on investment, it would |
| keep large sums of money as liquid cash. This is | | | | be wise if you could start up with funds that have |
| one disadvantage of a mutual fund because, | | | | low investment requirements. |
| keeping liquid cash is detrimental to the growth of | | | | A front load fund entails paying the commission |
| a portfolio since, it ties the money. The money is | | | | that would accrue up front and in a back fund, |
| not invested in productive endeavors, thereby | | | | you pay the commission upon selling all or part of |
| reducing the benefits that could have been | | | | your holding. A constant load fund deducts |
| accrued. | | | | commissions on a regular basis, while a no load |
| The various fees charged include shareholders | | | | does not charge any commission. There are |
| fees, which come in the form of loads and | | | | many no load funds out there and in most |
| redemption fees. Loads are divided into front, | | | | instances, they out perform the loaded funds |
| back and constant as well as no load fund, | | | | since all your money goes into buying shares. |
| calculated as a percentage of the amount of | | | | There are also many examples of load funds out |
| stock you wish to buy or sell. Annual fund | | | | there, but the most prominent ones are the index |
| operating fees include the cost of keeping | | | | mutual funds. |