How long can the Letter of Intent be backdated for practical purposes?

A Letter of Intent (LOI) in the context of mutual funds and certain investment accounts allows investors to commit to investing a specific amount over a period of time while receiving the benefits of a lower sales charge. For practical purposes, the LOI can typically be backdated for a maximum of three months before the date of the LOI.

This three-month backdating is significant because it allows the investor to count any investments made during this time towards the total commitment of the LOI. This flexibility incentivizes larger upfront investments, enabling investors to take advantage of reduced sales charges sooner. Hence, identifying the correct backdating period as three months aligns with regulatory standards and practices in the investment industry, ensuring that investors can effectively utilize their contributions while benefiting from the cost savings associated with higher total investments.