Closed End Funds
An interval fund that offers to repurchase shares from investors may charge a maximum repurchase fee of:
Interval funds: periodic repurchase offers (quarterly), max 2% repurchase fee.
Complete Analysis & Legal Rationale
Interval funds may charge a repurchase fee of up to 2% to cover the costs of the repurchase offer. This fee compensates the fund for providing periodic liquidity in otherwise illiquid investments.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
1% is below the maximum permitted repurchase fee.
Matches the verified teaching point in the explanation.
3% exceeds the regulatory maximum.
5% significantly exceeds the permitted fee.
Official Standard: Outline-level citation: item maps to Series 7 topic coverage. Prefer a specific FINRA/SEC/MSRB rule citation in a later author pass.