Load-Adjusted Return

Definition of 'Load-Adjusted Return'


A load-adjusted return is how much of a return an investor actually sees, after investment fees charged to buy and sell shares of mutual funds are subtracted from investment returns. If an investor puts $6,000 into a no-load mutual fund and earns a 10% return the first year, he has earned $600 if he decides to cash out. But if the mutual fund charges a 1% front-end load to buy shares, the investor would lose $60 when he purchased, leaving $5,940 to invest. The same 10% return would then earn him only $594.

Investopedia explains 'Load-Adjusted Return'




Loads, or fees charged by some mutual funds for buying and selling shares, are like all other investment fees in that they have a significant impact on an investor's returns, especially over the long run. For this reason, many investors advocate sticking to mutual funds that have no loads, no 12b-1 fees and very low expense ratios.



comments powered by Disqus
Hot Definitions
  1. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  2. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  3. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
  4. Degree Of Financial Leverage - DFL

    A ratio that measures the sensitivity of a company’s earnings per share (EPS) to fluctuations in its operating income, as a result of changes in its capital structure. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in earnings before interest and taxes (EBIT).
  5. Jeff Bezos

    Self-made billionaire Jeff Bezos is famous for founding online retail giant Amazon.com.
  6. Re-fracking

    Re-fracking is the practice of returning to older wells that had been fracked in the recent past to capitalize on newer, more effective extraction technology. Re-fracking can be effective on especially tight oil deposits – where the shale products low yields – to extend their productivity.
Trading Center