An Open-End Fund is a mutual
fund which can issue and redeem shares at any time. Most well-known
funds, such as Fidelity's Magellan, Vanguard's S&P 500, and PIMCO
Total Return, are open-end funds. An investor can purchase shares
in such funds directly from the mutual fund company, or through
a brokerage
house. There may be a percentage charge levied on purchase or sale
of shares--in this case, the fund is a "load fund"; if there are
no such charges levied, the fund is "no-load." However, brokerages
may charge commissions for the purchase of even no-load funds, and
there may also be other fees associated with no-load funds, such
as yearly maintenance fees in IRA
accounts and redemption fees designed to discourage shareholders
from jumping in and out of funds in an attempt at market timing.
The price per share, or NAV (net asset value), is calculated by
dividing the fund's assets minus liabilities by the number of shares
outstanding. This is usually calculated at the end of every trading
day.
