The typical investment company, whether organized in the form of a trust, partnership, organized group, or corporation, is engaged primarily in the business of investing in securities. There is no secondary trading market for the shares of such companies.
Some funds have sales charges that are imposed only upon a redemption of shares.
The amount of the charge may depend upon the length of time the shares have been held, in which case the charge is referred to as a contingent deferred sales load. Other funds may levy a sales charge against a shareholder's account for a number of years. Shares of all these companies may be purchased through broker-dealers who receive part of the sales charge. Shares of a no-load fund usually may be purchased directly from the investment company or its underwriter. Newspaper listings of mutual fund share prices often indicate the presence or absence of these various charges, and a mutual fund prospectus includes, immediately after the cover page, a table showing fees and expenses charged individual shareholders or to the fund itself.