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The expense ratio does not include sales fees like front-end loads, which are paid by investors at the time of purchase, or deferred sales loads, which are levied when an investor sells fund shares.
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The customer sets up an online account and then buys and sells funds within that account.
Can I still buy and sell fund units?
Mr. Ostrowski denies ever having broken any rules selling fund shares.
But selling fund shares at the time would have meant a large tax bite this April.
If you sold fund holdings last year, Mr. Luscombe said, you should check past records of reinvested dividends.
Regulators have recently increased their scrutiny of the relationships between fund managers and the brokerage firms that not only execute their trades but also sell fund shares.
But because thousands of brokers are selling fund shares, fund companies routinely give the brokers time to relay the orders that came in before the close.
In addition to the gains distributed by a fund, an individual shareholder will also have a gain or loss when selling fund shares.
In addition, mutual-fund companies often earn less money by selling fund shares to retail customers than they do by selling 401(k) plans and other investment packages to the same large corporations in whose stocks their fund managers invest.
Among them, he said, would be imposing a strict daily deadline for placing trades and penalties for selling fund shares shortly after buying them.
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