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Simple English definitions for legal terms
no-load fund
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A quick definition of no-load fund:
A no-load fund is a type of mutual fund that doesn't charge any commission when you buy or sell shares. It's like a big pot of money that lots of people put their money into, and then a professional manager invests that money in different things like stocks and bonds. This helps spread out the risk and can potentially make you money. No-load funds are a good option if you want to invest without paying extra fees.A more thorough explanation:
A no-load fund is a type of mutual fund that does not charge any sales commission to investors. However, it may still charge fees to cover operating costs.
For example, if an investor buys shares in a no-load fund for $100, the entire $100 will be invested in the fund. In contrast, a load fund may charge a commission of 4 to 9%, meaning that only $91 to $96 of the $100 investment will actually be invested in the fund.
No-load funds are attractive to investors who want to avoid paying sales commissions and prefer to have their entire investment amount working for them.
Overall, no-load funds are a good option for investors who want to save money on fees and expenses while still investing in a diversified selection of securities.