Effective August 01, 2009, the Securities and Exchange Board of India (SEBI), abolished the ‘entry load’ viz. fee deductable, from the amount of money one invests in a mutual fund schemes. Till now, a fee of 2.25% was being charged by mutual funds (and asset management companies) under the pretext of expenses incurred in marketing and selling of the mutual funds. What remains permissible is an exit fee of up to 1% of the redemption amount which the funds can levy for paying commissions to distributors and for marketing and selling expenses.
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