Fees and Expenses

What this video covers

• The 8.5% maximum aggregate sales charge as a percentage of public offering price (POP), and how it steps down to 8.0%, 7.75%, or 7.25% when rights of accumulation, quantity discounts, or service fees are missing
• Why front-end and deferred sales charges are generally prohibited on shares purchased through dividend reinvestment
• The structural differences between Class A (front-end load with breakpoints), Class B (contingent deferred sales charge, or CDSC, with Class A conversion), and Class C (level load) shares, and which investor profile matches each
• Why only Class A shares offer breakpoint discounts, and why Class B shares automatically convert to Class A after six to eight years
• The 1.00% annual 12b-1 fee cap split between distribution (0.75%) and shareholder servicing (0.25%), plus the 0.25% threshold that defines a true no-load fund
• The four-step board approval, quarterly reporting, and annual re-approval requirements for 12b-1 plans
• How the expense ratio is calculated (total annual operating expenses divided by average net assets), what it includes (management fees, 12b-1, administrative, custodian, legal), and what it excludes (sales loads and brokerage commissions)
• Why no-load status does not guarantee a low expense ratio