A redemption charge is designed to discourage frequent trading in and out of particular mutual funds.

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A redemption charge is a fee charged by mutual funds to discourage investors from frequent buying and selling of fund shares. It is also known as a "back-end load" or "deferred sales charge." The goal is to encourage a long-term investment strategy and prevent trading that can disrupt the fund's performance and increase transaction costs.

A Redemption Charge Is Designed to Discourage Frequent Trading in and Out