Shareholder Service Fees are fees paid to persons to respond to investor inquiries and provide investors with information about their investments. multiclass structure offers investors the ability to select fee and expense structure that is appropriate for their investment goals or tolerance for risk change. They often have lower minimum investment thresholds than traditional, unregistered hedge funds and can sell their shares to larger number of investors.

Newly created or small funds sometimes have excellent shortterm performance records. Liquidity Mutual fund investors can readily redeem their shares at the current NAV plus any fees and charges assessed on redemption at any time. Costs Despite Negative Returns Investors must pay sales charges, annual fees, and other expenses which well discuss below regardless of how the fund performs. But each class has different shareholder services andor distribution arrangements with different fees and expenses and therefore different performance results. Also known as backend load, this fee typically goes to the brokers that sell the funds shares.

To learn more about funds exchange policies, call the funds tollfree number, visit its website, or read the shareholder information section of the prospectus. You can lose money investing in mutual funds.Past performance is not reliable indicator of future performance. Funds that invest in longerterm bonds tend to have higher interest rate risk. The investment levels required to obtain reduced sales load are commonly referred to as breakpoints. The SEC does not require fund to offer breakpoints in the funds sales load.

Some investors find it easier to achieve diversification through ownership of individual stocks or bonds. Key Points To RememberHow Mutual Funds WorkFactors to ConsiderAvoiding Common PitfallsIf You Have ProblemsGlossary of Key Mutual Fund Terms 12b1 Fees fees paid by the fund out of fund assets to cover the costs of providing shareholder services. Degrees of Risk All funds carry some level of risk. But ETFs are not considered to be, and are not permitted to call themselves, mutual funds.

Shareholder Reports mutual fund also must provide shareholders with annual and semiannual reports within days after the funds narrative description of its investment objectives or goals, principal strategies for achieving those goals, principal risks of investing in the fund, fees and expenses, and past performance. Unlike openend mutual funds, funds of hedge funds, please readFINRAs Investor Alert entitledFunds of Hedge Funds Higher Costs and Risksfor Higher Potential Returns. Advantages and Disadvantages Every investment has advantages and disadvantages. Looking at the expense ratio can help you make comparisons among funds.