Series 7 practice questioneasyPackaged Products — Mutual Funds
Which share class of mutual fund typically charges a front-end sales load?
- AClass A shares✓ Correct answer
- BClass B shares
- CClass C shares
- DNo-load shares
Explanation
Why A — Class A shares
Class A shares charge a front-end sales load (commission) at the time of purchase, which reduces the amount of money actually invested. In exchange, Class A shares typically have lower ongoing 12b-1 fees compared to Class B or C shares, making them more cost-effective for larger or longer-term investments.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 755+ Series 7 questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Related Investment Information & Recommendations questions
- A client invests $100,000 in Class A shares with a 5% front-end load. How much is actually invested in the fund?
- A mutual fund has total assets of $500 million, total liabilities of $10 million, and 20 million shares outstanding.…
- An investor qualifies for a breakpoint discount on mutual fund Class A shares. Which of the following would NOT count…
- How is a mutual fund's net asset value (NAV) calculated?