Fee Table

Walking a client through the front of the Wexbury Growth Fund prospectus, a representative points to two adjacent tables. The first is headed Shareholder Fees; the second, Annual Fund Operating Expenses. The maximum front-end sales charge and the contingent deferred sales charge appear in:

1. A.The Annual Fund Operating Expenses table, because both are sales-related chargesThat table lists charges deducted from fund assets each year - management fee, 12b-1 fee and other expenses - not transaction charges.
2. B.The front-end load in Shareholder Fees, but the contingent deferred sales charge in Annual Fund Operating ExpensesA CDSC is paid by the redeeming investor at the time of redemption, so it belongs with the other shareholder transaction fees.
3. C.Neither table; sales charges are disclosed only in the Statement of Additional InformationThe fee table in the prospectus is exactly where sales charges must appear.
4. D.The Shareholder Fees table, because both are paid directly by the investor at the time of a transactionCorrect. Shareholder Fees covers charges the investor pays out of pocket on purchase, redemption or exchange; ongoing charges deducted from fund assets sit in the operating expense table.

Why: The fee table is split by who pays and when. Shareholder Fees are charges paid directly by the investor at the moment of a transaction - the front-end sales load, any contingent deferred sales charge, redemption and exchange fees. Annual Fund Operating Expenses are deducted from fund assets every year and reduce the return of every shareholder: the management fee, the 12b-1 fee and other expenses.

Beneath its fee tables, the Wexbury Growth Fund prospectus shows an Example: a table of the dollar cost an investor would bear on a 10,000 dollar investment held for 1, 3, 5 and 10 years. The purpose and assumptions of that table are that:

1. A.It projects the return the fund expects to earn over the periods shownThe 5% is a uniform convention applied to every fund. It is not a forecast of this fund performance.
2. B.It standardises cost comparison by assuming a 10,000 dollar investment, a 5% annual return and unchanged operating expenses, and shows the result both with and without redemption at the end of each periodCorrect. The fixed assumptions let an investor compare funds on cost alone, and the redeemed and not-redeemed columns reveal the effect of a CDSC.
3. C.It is required only for funds that impose a front-end or deferred sales chargeEvery fund prospectus contains the Example, including no-load funds.
4. D.It includes the portfolio transaction costs the fund incurs and the taxes the shareholder will payThe Example covers the operating expenses in the fee table; portfolio trading costs and shareholder taxes are outside it.

Why: The Example exists to make cost comparable across funds, so its assumptions are fixed rather than fund-specific: a 10,000 dollar investment, a 5% annual return, reinvestment of all distributions, and operating expenses that stay at the level shown. For share classes carrying a contingent deferred sales charge it is presented both on the assumption that the shares are redeemed at the end of each period and on the assumption that they are held, which is how the effect of the CDSC becomes visible.