In
loaded mutual funds, the right of a
shareholder to a reduced
load or sales fee when he/she purchases more than a certain a dollar amount of the mutual fund. The dollar amount is known as the
breakpoint. For example, if the breakpoint for a certain mutual fund is $50,000, an
investor has the right to reduce the load by, say, half when he/she invests more than $50,000 in the fund. It thus becomes advantageous for the 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. The right of accumulation is not limited to a single
investment; an investor putting two tranches of $25,000 into the above mutual fund will usually find his excess load
refunded.