Which of the following best describes the key difference between a Series A and a Series F mutual fund?

Question: Which of the following best describes the key difference between a Series A and a Series F mutual fund?

Answer options: ✅ Series A typically includes advisor compensation in its MER, while Series F does not and is designed for fee-based accounts.

• Series A funds are actively managed, whereas Series F funds are passively managed.
• Series A has a higher minimum investment requirement than Series F.
• Series A funds distribute income monthly, while Series F funds distribute income annually.

Correct answer: Series A typically includes advisor compensation in its MER, while Series F does not and is designed for fee-based accounts.

Explanation: Series A funds typically have a higher Management Expense Ratio (MER) because they embed the advisor's compensation (trailer fee) within the fee structure. Series F funds are designed for investors in a fee-based advisory relationship and therefore have a lower MER, as the advisor's fee is paid separately by the client.