Many mutual funds collect redemption fees from investors when shares of the fund are sold prior to the expiration of a holding period as specified in a fund's prospectus. These fees are calculated on a percentage basis based on the value of the shares being redeemed and range from 0.5% to 2.0%. The fees are retained by the fund and are intended to discourage short-term investing and excessive trading.
In order to process a short-term redemption fee, shares of mutual funds that carry such a fee must be tracked, or aged, beginning at the time of purchase. Then, at the time of sale, shares must be examined to determine if they are subject to a redemption fee.
The holding period and fee percentage differs depending on the fund. This information is outlined in a fund's prospectus and may be shown on a fund's fact sheet.
For more information on your personal account, please click here to access VALIC Online, log in, and then select "View your account." You will be able to view redemption fee details for funds in your plan that have redemption fees.