C-Shares

  

These mutual funds have no front loads (get your minds out of the gutter...that just means they don't have commissions charged when you get them). But they do have small back-end loads of about 1%. (Sheesh, we give up. Giggle about "back-end loads" if you must.) If you hold the fund for at least a year, that number may disappear altogether.

Related or Semi-related Video

Finance: What are Sales Charge and Sales...1 Views

00:00

finance a la shmoop what are sales charges and sales loads sales charges or

00:09

loads as they're lovingly called in the industry are just commissions customers

00:13

pay when they buy mutual funds but because there are so many ways in which [People dealing out cash]

00:18

to pay these commissions or at least in the way they get calculated they become

00:22

a whole trivia contest catalog on their own in the good old days things were [People playing a trivia contest gameshow]

00:26

simpler mutual funds were paid in a load up front like you bought a thousand [Stacks of cash appear]

00:31

dollars worth of a mutual fund paid 50 bucks for the privilege and then the

00:35

professionals you hired went to work with your remaining nine hundred fifty

00:39

bucks to make it you know grow but then came break points basically volume

00:44

discounts as they apply to the pricing of those commissions the more you invest

00:48

a smaller the percentage you pay in Commission then came quote no-load

00:53

unquote funds which instead of charging say five percent upfront and then

00:58

investing that nine fifty under a fee structure of one percent a year they

01:02

started investing all thousand dollars with no Commission upfront but instead

01:07

customers would pay two percent of your commission so over time if mutual fund

01:12

buyers held that fund five years or more while they paid more than they would

01:16

have even in the most onerous of upfront a share load situations yeah not good no [Load comparisons appear]

01:22

low doesn't mean no commission or fee or sales charge it's just marketing stuff

01:28

for gullible consumers who bought it so why is it called the load anyway well [Person purchasing item from checkout]

01:33

the Commission itself detracts from the total amount of capital being invested [Commission cash taken from capital]

01:38

which then has to grow and presumably beat the market or you just buy an index

01:42

fund right well if a mutual fund investment house isn't in fact beating [Man and woman fighting in martial arts]

01:46

the market then mathematically there's no reason to buy the fund because

01:49

investors can simply buy the market in investing in those index funds or ETFs [Man discussing investments with index funds or ETFs]

01:53

or exchange-traded funds yeah so the load is essentially rocks in your

01:59

backpack or a natural headwind against the sales of that mutual fund they feel [Man on a boat with a headwind]

02:05

like a heavy load if you're ascending mutual fund mountain

02:09

with the 18 rocks there in your Patagonia pack and it's probably no [Man sweating with backpack full of rocks]

02:13

surprise that mutual fund mountain is Disney's least popular ride

Up Next

Finance: What Are Mutual Funds?
189 Views

What are mutual funds? Mutual funds are an aggregation of stocks, professionally managed for a "small" fee. Investors wanting exposure to a given a...

Finance: What are Different Types of Mutual Funds?
20 Views

What are the different types of mutual funds? There are many different types of mutual funds, including bond funds, equity funds, money market fund...

Finance: What's the Difference Between Mutual Funds and Index Funds?
121 Views

What is the difference between mutual funds and index funds? Mutual funds are professionally managed. Those investors trade shares and realize taxa...

Finance: What is commission?
112 Views

What is commission? Commission is incentive based compensation earned by facilitators based on a percentage of the dollar value of the transaction(...

Find other enlightening terms in Shmoop Finance Genius Bar(f)