A form of sales charge imposed on investors by some mutual funds. These charges may be called back-end loads, deferred loads, deferred sales charges, contingent deferred sales charge ( CDSC), or redemption fees. Regardless of the name, funds with deferred sales charges are simply one form of load funds. These funds offer investors the opportunity of paying a sales charge later rather than paying one at the time of purchase. The main advantage is that earnings from the investment in a deferred charge fund are paid on the full amount of the investor's principal.
In contrast, earnings in a fund with an front-end load are only paid on the net amount of the investor's principal after the front-end charge is deducted. A second, potentially significant, advantage, is that deferred sales charges often decrease as the investor's holding period lengthens.
See front-end load, load, and no-load. American Banker Glossary
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back-end load UK US noun [C] (UK ALSO exit charge)
► FINANCE an amount of money that an investor pays when selling shares in some types of investments: »
The fund also carries a back-end load: 2.5% if you redeem within the first year, and 1.25% if you sell between one and two years.
Financial and business terms. 2012.