Frequently Asked Questions
About the Mutual Fund Calculator
Contents
Q1. What is the Mutual Fund Cost Calculator?
Q2. Why has the SEC created this program?
Q3. What is included in "total costs"?
Q4. What costs are not included in the Cost Calculator?
Q5. How do you access the Cost Calculator?
Q6. What kind of computer or other equipment do you need?
Q7. Where do I get the information to enter into the Cost Calculator?
Q8. Where can I find definitions of unfamiliar terms used in the calculator?
Q9. Can the Cost Calculator download information directly from any mutual funds or mutual fund rating agencies?
Q10. Does the Cost Calculator cost anything to use?
Q11. Who can I contact with questions?
Q12. Where can I get more information about mutual funds and fees?
Q13. The fee table of my fund has two numbers for operating expenses. Which should I use?
Q14. I don't remember which class I invested in. How can I find out?
Q1. What is the Mutual Fund Cost Calculator?
A1. The SEC's Mutual Fund Cost Calculator is an easy-to-use
computer program that allows investors to compare the total costs of
owning different mutual funds. It also provides definitions for terms
that users will come across while investing in mutual funds.
Q2. Why has the SEC created this program?
A2. The Cost Calculator serves two primary purposes. First,
it enables investors to compare the cost of owning funds before buying
them. Second, it clearly demonstrates the effect that fees have on foregone
earnings and total costs.
Q3. What is included in "total costs"?
A3. Total costs is the sum of the fees paid plus the foregone
earnings. Fees include payments made when the account is opened or closed
as well as operating expenses. Once these fees are paid to the fund
company rather than being invested in the fund, an investor foregoes
earnings. Therefore, the higher the fees, the higher foregone earnings
there will be.
Q4. What costs are not included in the Cost Calculator?
A4. This program does not include all fees that you may be charged (for example, exchange fees, or account maintenance fees). These fees, however, are relatively small. In addition, deferred sales charges (discussed later in the Cost Calculator) are based on the lesser of the initial investment or the values of the investment at redemption, but some funds may base the charge solely on the initial investment.
Q5. How do you access the Cost Calculator?
A5. To run the cost calculator on the SEC website, you must use a
JavaScript enabled browser.
Q6. What kind of computer or other equipment do you need?
A6. The JavaScript
version requires a JavaScript enabled web browser, such as Netscape NavigatorTM 2.0 or higher, or Microsoft® Internet Explorer 3.0 or higher.
Q7. Where do I get the information to enter into the Cost Calculator?
A7. All of this information is in the prospectus of the specific
fund you are considering.
Q8. Where can I find definitions of the terms such as sales
charge or operating expense?
A8. Simply click on the underlined term in the program.
Q9. Can the Cost Calculator download information directly from
any mutual funds or mutual fund rating agencies, such as Morningstar
or Lipper?
A9. No. The Cost Calculator is not connected to a database
and only generates answers from the information that you provide. In
addition, the program does not collect any information about you.
Q10. Does the Cost Calculator cost anything to use?
A10. No.
Q11. Who can I contact with questions?
A11. Let us know how we can improve the Cost Calculator by e-mailing
us at help@sec.gov. Be sure
to check this page often, as we will be adding both questions and answers
from time to time. In addition, the SEC Office
of Investor Education and Advocacy has publications on this website that can answer many of your basic investing questions.
Q12. Where can I get more information about mutual funds and fees?
A12. We've provided a list of publications on the basics of investing in mutual funds and more information about fees. You'll also find information here from the Department of Labor about fees and 401(k) plans.
Q13. The fee table of my fund has two numbers for operating expenses. My total annual fund operating expenses are 1.36% and net operating expenses are 1.31%. Which number should I use?
A13. Some funds have fee waivers or expense reimbursements that reduce the operating expenses. Total annual fund operating expenses are the amounts paid if there were no fee waivers or expense reimbursements. Net operating expenses – the lower number – is the amount paid as a result of fee waivers or expense reimbursements. The cost can be estimated by entering either the total annual fund operating expenses or the net operating expenses, or by calculating the cost using each number to see the difference
Q14. I want to try the calculator using a fund I already own. The fund has multiple classes but I don't remember which class I invested in. How can I find out which class I invested in?
A14. Check the confirmation you received when you purchased shares in your fund or your account statement for information about the fund's class. Otherwise contact your broker, if you are using one, or the fund company.
http://www.sec.gov/investor/tools/mfcc/mfcc-faq.htm
