Should i invest in a shares or c shares

Log in or Register to post new content in the forum. Even if they are LT investors, does the benefit of having the ability to move within the first years outweigh the 12b1s on As every quarter?

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Long term is a long time. Fund families blow up Putnam , they grow too big AF? Clients lives and needs change. For these reasons, I believe that C shares almost always if not always make the most sense.

Again, this is not always the case, and its certainly not right, but its a fact of life most of the time. Okay children, gather around, I have a little history to share with you.

Incredible you might wonder? Yes, not only that, but the front-end loads were as high as 8. How can this be? You must be wondering how difficult it must have been to be a broker? Imagine, making in one ticket what many of you take 8 years to make in today's C-share.

Things were simpler then. There was an incentive for the client to make a larger investment. Then No-load shares began to appear in the late '80s and by the early '90s, all the big mutual fund companies introduced B-shares. B-shares give you the impression of a no-load fund. The mutual fund companies would get loans to pay the brokerage firms and in turn had to raise the management fees enough to cover the interest expense on the loans.

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If the client wanted to leave prior to 6 years, they would take the hit on the way out. What happened then was that many abused the breakpoint rules.

In comparing the Class A and Class C share options, the primary academic criticism of Class C shares is that they are more expensive for long-term investors. This assertion is usually supported by illustrations of the effect of compounding over long periods of time, which show that a one percent difference in expense ratios between otherwise identical mutual funds can lead to significant differences in wealth accumulation over periods of 20 or 30 years. A second criticism of Class C versus Class A shares involves the application of breakpoints for volume purchases.

For investors with significant sums to invest, purchasing A shares in a single fund family would likely result in significantly lower investment costs than C shares, which do not offer any form of volume discount. That's it for now. We can discuss it some more tomorrow. Other than explosive fund families, there is also the issue that most fund families aren't good in every area.

So A-shares discourage good investment allocation. But you have some flexability after the CDSC expires. These are all obsolete as the future is wrap programs of various types.

Is it Best to Buy A, B, or C Shares?

I don't like "A" shares. My primary reason is that I can't afford to service the account which is ultimately bad for the client despite the fact that they are the cheapest way to invest with me for a buy and hold investor.

The issue that you will have to deal with in using "C" shares for long term accounts is getting your Broker-Dealer to allow you to use a "C" share. Log In or Register.

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Log in or register to reply. Apr 23, My humble opinion only: A shares - numbers make sense if you are going to hold long term- HOWEVER!!!!!! Apr 24, Apr 24, 7: