A mutual funds net asset value is 3930 but the fund charges, Ask an Expert

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A mutual fund's net asset value is $39.30, but the fund charges a 3 percent load fee (front-loaded) and an exit fee of 1 percent (if redeemed in 6 motnhs) of net asset value. An individual client purchases 10 shares of the mutual fund on Jan 5 of year 20X1. During the year 20X1, the fund distributes $3.45 capitial gain and $0.75 dividend income. The asset value rises to $42.12 on Jan 5 of year 20X2 and the investor redeems the shares.(PLEASE SHOW WORK)

a) what is the percentage return the fund can report that was achieved by its portfolio managers?

b) What is the percentage return the individual earned on the investment? Why is this answer different from the answer is part (A)?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92855598

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