No-Load Fund
Candlefocus EditorNo-load funds are available in both taxable accounts as well as tax-deferred accounts like 401ks, IRAs and healthcare savings accounts. A no-load fund offers a diversified portfolio and allows investors to set up automatic contributions. This enables investors to buy into funds with a small amount of money until they build up their resources to make larger investments in the funds.
The disadvantage is that the investor needs to be aware of the expenses associated with running a fund such as management fees, administrative fees, custodial fees and other transaction fees. As a no-load fund seller, the investment company makes its income by the expenses associated with the fund, so investors should pay attention to these charges.
Overall, no-load funds have become an increasingly attractive investment tool for investors because they offer a more cost-effective way to invest in mutual funds. With no-load funds, investors can buy more shares while investing in a professionally managed portfolio that is diversified. Although there are fees associated with the fund, they are often lower than the fees associated with a load fund, allowing investors to put more of their money into their investments.