load spread option

Load Spread Option

A method of collecting the annual fees from investors in load funds through periodic deductions. These periodic deductions often are taken off of regular investor contributions to the fund to spread out the burden of the load fees over time.

Notes:

With a load spread option, a mutual fund investor is able to contribute a fixed amount of savings to the fund on a periodic basis (e.g. after each employment paycheck) and avoid having to pay a lump-sum load fee each year, since a portion of the fee is paid with each contribution.

See also: Deduction, Expense Ratio, Load Fund, Mutual Fund, No-Load Fund, Open-End Fund

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Load spread option

A method of allocating the annual sales charge on load funds, often through percentage deductions from a customer's periodic fixed payments.

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load spread option

The allocation of sales charges on mutual fund shares purchased on a contractual plan over a period of years. Sales charges may amount to as much as 20% of any single year's payments during the first four years, provided the total charges for the four years do not exceed 64% of any single year's payments. Also, the total sales charge cannot exceed 9% of contributions of the total value of the contract.