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Practice Test (Mutual Fund)
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The annualized value of contingent differed sales charge would
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A
decrease if the investor stays with the fund longer
💡 Explanation:
Contingent Deferred Sales Charge (CDSC) decreases over time as the investor holds the fund longer - this is how it incentivizes long-term investment. The annualized value decreases because the total charge is spread over a longer holding period, and the charge percentage typically declines each year.