Contractual Plan

Contractual Plan - a contractual plan is an agreement that is arranged between a mutual fund company and an investor. The arranged agreement is said to say that the investor agrees to deposit a certain amount of money, in certain intervals to accumulate shares of mutual funds. The agreement requires the deposits to be made at regular intervals. For example, an investor agrees to make a deposit of $100 on the first and 15^th of each month. The number of shares he purchases will vary depending on the value of the mutual fund at the time of the purchase. The invested is obligated to make the purchase no matter what the value of the mutual fund may be.