Question

Samantha instructs her broker to purchase $3,000 of Fidelity Growth fund shares. The closing NAV for that day was $52.0, the public offer price (POP) on the same day was $53.61. What is the sales charge (%) for this fund?

Answer 1

PUBLIC OFFER PRICE = $53.61

CLOSING NET ASSET VALUE = $52

TOTAL PURCHASE = GROSS AMOUNT INVESTED =  $ 3000

NUMBER OF SHARES BOUGHT = GROSS AMOUNT / POP = 3000/53.61 = 55.9597

NET AMOUNT INVESTED = NUMBER OF SHARES BOUGHT * NAV = 55.9597 * 52 = $ 2909.9044

SALES CHARGE PAID = GROSS AMOUNT INVESTED - NET AMOUNT INVESTED = 3000 - 2909.9044 = $ 90.0956

SALES CHARGE RATE = SALES CHARGE / GROSS AMOUNT INVESTED = 90.0956 / 3000 = 0.0300318 = 0.0300 OR 3.00% (ANSWER)