Back-end Load

Definition - What does Back-end Load mean?

Back-end Load is also know as a contingent deferred sales charge; a mutual fund sales charge that is assessed upon the redemption of the shares. The amount of the sales charge to be assessed upon redemption decreases the longer the shares are held.

Testopedia explains Back-end Load

Mutual funds charge distribution fees or sales charges which are a cost of distribution that is paid for by the investors in the mutual fund. Class B shares as they are also known charge a sales charge to the investors when the redeem their shares. These sales charges generally decrease over time, the longer the shares are held. In some cases if the shares are held long enough the B shares will convert to A shares and there will be no sales charge assessed up redemption.

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