I am looking at this fund:


Under the summary tab, in the Profile and Investment Heading, it lists in a table format the Ongoing charge at 2.4%, the Initial charge at 5%, the Max annual charge at 1.87%, and exit charge at 0%.

Now I am assuming the Ongoing charge means a fee charged every year. Is this fee fixed or can it change year-to-year?

The Initial charge I am assuming is the percentage you pay when you buy into the fund. So if I were to invest 10,000$, 500$ would be deducted as this fee.

What does the Max annual charge mean? Since there is already an Ongoing charge, and it's higher at 2.4%, I don't understand what the Max annual charge is/means.

Exit charge I'm assuming is the fee paid when you sell.

Thanks for the clarifications.

  • 2
    Those numbers mean you should find a better fund...
    – Jon Custer
    Aug 14 at 19:12

1 Answer 1


Without getting into the specifics of this fund, in general you can expect any or all of these fees when investing in a mutual fund. These are based on the Security and Exchange Commission's website. Since this fund is brokered in Luxembourg and apparently based in China, terms may vary significantly.

There are shareholder fees related to transactions, and operating costs (such as investment advisory fees for managing the fund’s holdings).

Ongoing Charges: the costs you can reasonably expect to pay as an investor from one year to the next, under normal circumstances. It represents an accurate cost of fund ownership as it encompasses the fund’s professional fees, management fees, audit fees and custody fees.

Sales Charges:

Front-end sales charges: are paid as a percentage of the purchase price at the time of the investment. Class A shares often have front-end sales charges.

Back-end sales charges: are paid as a percentage of the selling price at the time of sale. Back-end sales charges are often associated with B-shares of a fund.

Deferred sales charges: are back-end sales charges that decline over time, often eventually reaching zero. They are also called contingent deferred sales charges because the fee is contingent on the holding period.

Annual Fund Operating Expenses:

Management Fees: Paid out of fund assets to the fund’s investment adviser

Distribution [and/or Service] (12b-1) Fees: Paid out of fund assets to cover distribution expenses.

Other Expenses: For example, legal and accounting expenses.

Total Annual Fund Operating Expenses: are expressed as a percentage of the fund’s average net assets.

  • 1
    Sales charges are also known as “load” (at least in the US). Front and Back End loaded mutual funds were the norm before Vanguard started No Load funds.
    – RonJohn
    Aug 14 at 19:42

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .