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You are going to invest in a stock mutual fund with a front-end load of 7 percent and an expense ratio of 1.35 percent. You
You are going to invest in a stock mutual fund with a front-end load of 7 percent and an expense ratio of 1.35 percent. You also can invest in a money market mutual fund with a return of 2.8 percent and an expense ratio of 0.30 percent. If you plan to keep your investment for 2 years, what annual return must the stock mutual fund earn to exceed an investment in the money market fund? What if your investment horizon is 9 years?
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