[fruhnt-end] 
| the sales commission and other fees taken out of the first year's payment under a contractual plan for purchasing shares of a mutual fund (front-end load fund) over a period of years. |
| front-end load n. The amount deducted from early payments made to a mutual fund purchase plan that covers expenses such as sales commissions. |
Front-End Load
A commission or sales fee charged at the time of the initial purchase for an investment, usually mutual funds and insurance policies. It is deducted from the investment amount and thus, lowers the size of the investment. For mutual funds, the use of loads is suggested to prevent frequent trading of the fund, which can hurt a fund if it has to hold large cash reserves to meet payouts.
Investopedia Commentary
Loads are added to the net asset value of shares when the offering price is calculated. Remember, this fee is nothing more than a sales commission. Its supporters (who, strangely enough, are usually mutual fund salespeople) argue that a load is the price you pay for a broker's expertise in selecting the correct fund for you. Despite this reasoning, just about every study shows that load funds do not outperform no-load funds.
Related Links
Mutual Fund Basics Tutorial
Digging Deeper: The Mutual Fund Prospectus
Mutual Fund Breakpoints: A Break Worth Taking
See also: Back-End Load, Commission, Exchange Privilege, Load Fund, Mutual Fund, No-Load Fund
Also spelled: frontend load, front end load, front-end sales charge
