Load fee

A sales commission charged when buying, a front-load, or selling, a back-load, certain mutual funds, on top of the fund's ongoing expense ratio.

Example

A 5% front-load fee on a $10,000 investment takes $500 before a single dollar is actually invested.

Important

Load fees pay whoever sold you the fund, not the fund's performance - a comparable no-load fund with a similar strategy exists in almost every case.

Related terms

• Expense ratio — The annual fee a fund charges, expressed as a percentage of the money you have in it.
• Fee drag — The compounding cost of fees over time, which is far larger than the fee's annual percentage suggests on its own.

Lessons that explain it

• The cost of fees — A 1% fee doesn't sound like much. Compounded over decades, it can quietly consume a quarter or more of everything you would otherwise have earned. (10 min)

All 578 terms in the Investing glossary