Linard wants to buy shares in a mutual fund. The current NAV is $44.18. He looks...

Linard wants to buy shares in a mutual fund. The current NAV is $44.18. He looks up fund characteristics on Robinhood and found the following: Operating Expenses: 1.10%, Front-end loan: 0.80%, back-end loan (if exiting after one year): 1.70%, and 12b-1 fees of 0.10%. What would be his rate of return if he buys this fund today and sells after one year if the fund returns 15% over this period?

Expert Solution

we invested 44.18

after 1 year we get 48.95

so his return = (48.95 -44.18)/44.18 = 8.985%

jeff jeffy answered 1 year ago

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Linard wants to buy shares in a mutual fund. The current NAV is $44.18. He looks...

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