Topic: Flat Transaction Fees Over Time
Correct Answer: #3, $25,865
You pay $20 on the front end, so are actually investing $9,980. Then 10% annually compounded for 10 years gets that sum up to about $25,885. Subtract $20 more when you sell out and there you have it.
Remember that a 10% annual market return under a 1.5% fee from your money manager only netted out about $22,600. This scenario snatches back over $3,000 in fees paid under the other model, resulting in a better total return over time.
