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For mutual funds, the point at which the amount invested reduces the sales charge is called the "breakpoint." Each mutual fund may have several breakpoints; the larger the investment, the greater the discount. Note that the actual reduction in the sales charge is known as the "breakpoint discount". Also, the term "breakpointing" is sometimes used to refer to the offering of breakpoint discounts. The practice of soliciting mutual fund purchases just below the breakpoint (to earn more commissions) is considered unethical and in violation of NASD rules. See: right of accumulation.
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In loaded mutual funds, a dollar amount an investor must buy into the fund in order to be eligible for a reduced load or sales fee. For example, if the breakpoint for a certain mutual fund is $50,000, and investments beyond that amount will halve the load, it becomes advantageous for an investor to invest $50,000 instead of, say, $45,000, because this will entitle him/her to half the load for the entire investment, and not just for the amount invested past $50,000. Mutual funds that allow investors to buy at just below the breakpoint may run afoul of Financial Industry Regulatory Authority regulations. An investment need not come all at once to pass the breakpoint; an investor putting two tranches of $25,000 into the above mutual fund will usually find his excess load refunded. See also: Right of accumulation.
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The cumulative level of purchases of shares in a mutual fund that is required before an individual purchaser can qualify for a reduced sales commission. Compare letter of intent. See also right of accumulation.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.


A breakpoint is the level at which your account balance in a mutual fund company or the size of a new investment in the company's funds qualifies you to pay a reduced sales charge.

Fund companies that charge a percentage of the amount you invest as a front-end load, or sales charge, may offer this cost saving. They are not required to do so, but if they do use breakpoints, they must ensure that all clients who qualify get the discount.

In most cases, the first breakpoint is $25,000, with further reductions for each additional $25,000 or $50,000 purchase. For example, if the standard load were 5.5%, it might drop to 5.25% at $25,000, to 5% at $50,000, and perhaps to as low as 2.5% with an investment of $250,000.

In calculating breakpoints, some fund companies will combine the value of all of your investments in the mutual funds they offer. Other companies count the investments of all the members of your household or give you credit for purchases you intend to make in the future.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
Although most of the breakpoints in the immunoglobulin loci occur at defined positions, those in the partner genes can occur anywhere over large areas of extragenic, nontranscribed sequences.
The role of pharmacokinetics/pharmacodynamics in setting clinical MIC breakpoints: The EUCAST approach.
We expect that these MICs would be utilized by renowned antimicrobial susceptibility testing agencies like CLSI and EUCAST in establishing breakpoints for these antibiotics against Salmonella Paratyphi.
Generally, in order to improve the accuracy and rationality of Rhtests, it is necessary to further confirm the detected breakpoints in combination with the metadata [15].
We were able to detect a LOLA peak, indicating a major breakpoint BCR-ABL1 translocation, in DNA from 13 of 15 (88%) CML patients.
Based on the principle of prestack diffraction migration, the contrastive study is carried out with diffraction of the breakpoint and the channel wave (Roslee et al., 2017; Lindang et al., 2017; Kamsani et al., 2017; Lai et al., 2017).
Diagram of the array-CGH results and the strategies to detect the chimeric gene are showed below: the primers used to locate the breakpoint in patient 1 (a), the qPCR results in the exons of affected genes of patient 2 (b), and the primers flanking the segmental duplication in patient 3 (c).
The debugging mode decides which debugging function is selected among internal breakpoint, external breakpoint, single stepping or other debugging functions.
Using the 2 [micro]g/mL EUCAST susceptibility breakpoint for vancomycin none of the values obtained for inhibition zone diameter would result in a major error rate under 1.5% (Fig.
In 2008, the CLSI recommended new breakpoints for the minimum inhibitory concentrations (MICs) of penicillin and ceftriaxone, proposing different interpretive criteria for determining the use of the two antibiotics in treating meningeal and non-meningeal infections.