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Funds 108: Introduction to Mutual Fund Prospectuses

Introduction to Mutual Fund Prospectuses What Is a Mutual Fund Prospectus? Mutual Fund Objectives Mutual Fund Management Mutual Fund Expenses The Mutual Fund Shareholder Manual Mutual Fund Details Found in the Prospectus Summary of Mutual Fund Prospectuses
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Mutual Fund Expenses

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Mutual Fund Expenses

Mutual fund expenses appear in their own section of the mutual fund prospectus. The transaction fees are listed in a table and include any or all of the following: the sales load, sales load on reinvested dividends, deferred sales load, redemption fees, and exchange fees. Transaction fees cover the buying, selling, and trading of shares. Here is a sample table:

Mutual Fund Operating Expenses

The operating expenses are listed in a table of their own. Operating expenses include management fees, 12b-1 fees (which cover marketing costs), and various other expenses. These are the fees that pay those who manage and maintain the fund. Many prospectuses provide hypothetical illustrations of the operating expenses.