Redemption fee

Redemption fee

A fee some mutual funds charge when an investor sells shares within a specified short period of time.

Redemption Fee

A fee that some mutual funds assess when a shareholder redeems shares from the fund during a certain, usually brief period of time after purchase. It may be a flat fee or a percentage of the value of the shares redeemed. Mutual funds charge redemption fees to discourage new investors from withdrawing from the mutual fund if the fund's net asset value drops unexpectedly.

Redemption fee.

Some open-end mutual funds impose a redemption fee when you sell shares in the fund, often during a specific, and sometimes brief, period of time after you purchase those shares.

The fee is usually a percentage of the value of the shares you sell, but it may also be a flat fee, or fixed amount.

The purpose of the fee is to prevent large-scale withdrawals from the fund in response to changes in the financial markets, which might require the fund manager to sell holdings at a loss in order to meet the fund's obligation to buy back your shares.

References in periodicals archive ?
Investors with existing standard DSC purchase option holdings will remain invested based on the redemption fee schedule applicable to those securities, and switches from existing securities acquired under the standard DSC purchase option will continue to be available.
Investors with existing standard DSC purchase option holdings will remain invested based on the redemption fee schedule applicable to those securities, and option to switch from existing securities acquired under the standard DSC purchase option will continue to be available.
A fund is required to impose redemption fees if the fund's weekly liquid assets fall below 10% of its total assets, unless the fund's board decides a redemption fee is not in the fund's best interests.
01 per right and this redemption fee will be paid on 15 September 2015 to all common stock shareholders of record as of 19 August 2015.
Investors received shares of Series A of IA Clarington Canadian Growth Class on a dollar for dollar basis and will be able to redeem their shares of IA Clarington Canadian Growth Class without paying a redemption fee.
It has a holding period of 30 days and has a redemption fee of one percent of the redemption amount.
If the remainder of the debt is refinanced RBS has agreed to waive 25% of its redemption fee, while Citizens has agreed to waive its entire redemption fee and discount the amount due to it by 5%.
Its research has revealed that the average mortgage redemption fee is now pounds 187, significantly higher than the pounds 35 "real" cost to lenders.
If residents default on their property taxes, a $15 redemption fee will be assessed and the taxes will be subject to additional penalties of 1.
Furthermore, it acknowledges that the IRS received a number of comments raising the issue of potential conflict with state insurance law that a mandatory redemption fee could raise.
In addition, the SEC has proposed a rule, Mandatory Redemption Fees for Redeemable Fund Securities, requiring, with certain exceptions, that funds require all shareholders to hold fund shares for five days or pay a 2% redemption fee.
They often charge a redemption fee to investors who withdraw funds before a specified period (e.