4. Comparing mutual funds Understanding the Costs Involved in Mutual Fund Investments Brian is debating purchasing a mutual fund, but he has some questions for his financial advisor, Crystal. The following table presents Information on four diferent open-end mutual funds that Brian and Crystal are scussing. Use the information in the table to answer the questions that row. NET CHG YTD % RET 2,5 FUND QUFP Pwrse PFIN TopLA NAV 15.32 18.77 27.81 -0.05 0.05 5.4 0.19 7.9 45.21 0.28 9.0 BRIAN: After some research, I've narrowed it down to these four funds, but can you explain to me the relationship between 125-1 fees and fund performance? CRYSTAL: Generally, funds that charge 125-1 fees, such as QuF p. outperform funds that do not charge these fees. BRIAN: What about front-end load fees? For example, suppose Topla has a front-end load fee of 6%, when do I pay this fee? CRYSTAL: If you purchase 100 shares of this fund at the NAV, you will pay a commission of S you will pays in front-end fees. . but when you sell these shares BRIAN: It sounds like these fees could start to add up. What's the most I can expect to pay in fees? ostica a 96 in back-end load CRYSTAL: Tf a fund charges a 2% front-end load and a 3.5% 12-b1 fee, then it can charge a maximum of only charges without violating the cap. BRIAN: Thanks! This was really helpful. So it sounds like you'd recommend looking for funds whenever possible. 4. Comparing mutual funds Understanding the Costs Involved in Mutual Fund Investments Brian is debating purchasing a mutual fund, but he has some questions for his financial advisor, Crystal. The following table presents Information on four diferent open-end mutual funds that Brian and Crystal are scussing. Use the information in the table to answer the questions that row. NET CHG YTD % RET 2,5 FUND QUFP Pwrse PFIN TopLA NAV 15.32 18.77 27.81 -0.05 0.05 5.4 0.19 7.9 45.21 0.28 9.0 BRIAN: After some research, I've narrowed it down to these four funds, but can you explain to me the relationship between 125-1 fees and fund performance? CRYSTAL: Generally, funds that charge 125-1 fees, such as QuF p. outperform funds that do not charge these fees. BRIAN: What about front-end load fees? For example, suppose Topla has a front-end load fee of 6%, when do I pay this fee? CRYSTAL: If you purchase 100 shares of this fund at the NAV, you will pay a commission of S you will pays in front-end fees. . but when you sell these shares BRIAN: It sounds like these fees could start to add up. What's the most I can expect to pay in fees? ostica a 96 in back-end load CRYSTAL: Tf a fund charges a 2% front-end load and a 3.5% 12-b1 fee, then it can charge a maximum of only charges without violating the cap. BRIAN: Thanks! This was really helpful. So it sounds like you'd recommend looking for funds whenever possible
