SIE Exam Practice Question 426

Correct Answer: B

Explanation:

B: If an investor plans to reach a breakpoint within the next 13 months, he can write a letter of intent (LOI) to his broker. The LOI is a signed, nonbinding statement of the investor's intent to invest enough over the next 13 months to reach the breakpoint. In response, the broker will charge the investor the discounted sales charge on current purchases. The additional shares the customer is able to purchase due to the discount will be held aside by the mutual fund until the customer actually reaches the breakpoint.