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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.


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.


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.


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.

References in periodicals archive ?
She spurned two set points before a pair of double faults allowed Konta back in and it was the Croatian who was relieved with a tie-break after saving four break points at 5-5.
Murray needed a reaction and duly delivered in the second game of the third set as he went 2-0 in front, grasping only his second successful break point in 11.
The crux of both set and match came when Watson fended off five break points when chasing a four-love third-set lead - but could not protect a sixth.
I had a few break points, a few chances to break in the first set, but I didn't manage to do that and the tie break was decided by one mistake with a forehand at 6-5.
5 began the second set like he started the match, forcing more break point opportunities in the opening game, which forced Federer into using soft hands at the net, and then produce an overhead volley to again keep the match in his favour.
Nadal saved seven of eight break points in the first set, including five which were set points for Ferrer in the 12th game.
We conclude that the introduction of PCV7 was associated with dramatic reductions in penicillin-non-susceptible invasive pneumococcal disease incidents," regardless of which break point was used, he said.
The introduction of PCV7 was associated with dramatic reductions in penicillin-nonsusceptible invasive pneumococcal disease incidents," regardless of which break point was used, Dr.
Two games later, she won her first French Open game at the 15th attempt and came close to levelling when she had break point in the fourth.
If the wall is long a break point will be detected in every step as value [DELTA]l every time will be bigger than previously.
Murray began in purposeful fashion, racing through his first service game to love and forcing a break point on the Seppi serve with a fierce return.
The Swiss raised himself in the second set and had a break point at 3-3 but Nadal slammed the door shut and crushed a hapless Federer in the third to clinch the title without losing a set, leaving Federer stuck on 12 Grand Slam titles.