No Load versus Load Funds

Novice here, would someone please explain the difference between these
funds. Thank you

load funds have a sales charge. usually between 4-9%. no load funds do not. basically with no load funds you cut out the middleman

There's a very detailed discussion on Load vs. no-Load a few threads down.

http://forums.kiplinger.com/showthread.php?t=10595

Remember that no one is managing your money for free. When comparing funds, you need to look at 3 places where expenses can be charged.

1. Front end load (a % of what you paid for the fund, which means not all of your money is going to work for you and the advisor who sold you the funds is getting a cut). I've never seen the 9% articledon mentioned, but have seen plenty that charge 5.75% for small investors. The percentage charge decreases if you have more in a particular fund family- for American Funds, for example, it's 2% if you have more than $500K invested in their funds. These are Class A shares mentioned in the thread I cited.

2. Annual expenses, usually expressed as a % of the value of the shares. No-load funds typically have higher annual expense ratios.

3. Back-end loads- a sales charge when you sell. Not all funds have these- I know that my A shares don't.

You really need to look at the whole picture. I chose A shares because I'm paying a 2% load and the funds where I have most of my money have been returning 20% per year since 2003. I also have a Schwab account with some very good no-load funds. To me, the most important factor is the return after expenses.