Which of the following fees and expenses are most important for long-term investors?
I. Management fees.
II. Front-end loads.
III. Deferred sales charges.
IV. Annual administrative fees.

Question

Quizplus · Accepted Answer

For long-term investors, the most important fees and expenses are those that have a direct impact on their investment returns. Management fees (I) are important because they are an ongoing expense that will erode investment returns over time. Annual administrative fees (IV) are also important as they are charged every year and can add up over the long-term. Front-end loads (II) and deferred sales charges (III) are less important for long-term investors as they are one-time fees that are paid upfront or upon redemption. As such, the best choice is B, which includes both management fees and annual administrative fees.

Which of the Following Fees and Expenses Are Most Important