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Ch.6 · ARN and EUIN Rules · medium

What is a 'no-load' fund?

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EXPLANATION

A no-load fund charges neither entry load nor exit load. SEBI banned entry loads for all mutual fund schemes in August 2009. Exit loads still exist in many schemes (to discourage short-term redemptions), but some schemes — particularly liquid and overnight funds — may have no exit load, making them no-load funds.

A.A fund that charges no TER

B.A fund that has no entry or exit load [✓ Correct]

C.A fund with no distributor commission

D.A fund that has no lock-in period

EXPLANATION

A no-load fund charges neither entry load nor exit load. SEBI banned entry loads for all mutual fund schemes in August 2009. Exit loads still exist in many schemes (to discourage short-term redemptions), but some schemes — particularly liquid and overnight funds — may have no exit load, making them no-load funds.

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