What is Exit Fee?
A fee or charge assessed to an investor for withdrawing money prior to a previously stipulated date. This is almost always expressed and charged as a percentage of assets rather than a flat fee.
May also be known as a “”redemption fee””, “”back-end load”” or “”contingent deferred sales charge””. Read more for examples and further explanation including related video clips and also comments
Example explains Exit Fee
Exit Fees may be found not only on mutual funds as back-end loads, but also on hedge funds, annuities and limited partnership units. Often the managers of these funds employ investing strategies that keep daily liquidity to a minimum, and the exit fees act as a deterrent to early withdrawals.
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