Investors need to bear certain transaction costs when purchasing funds. Because the expected returns of the fund itself are not high, especially bond funds, transaction costs have a relatively large impact on the expected returns of the fund. The same fund product will be divided into Category A and Category C according to different charging rules. So which fund A or C is more cost-effective?

1. Fund Transaction Rate The main difference between Fund Category A and Category C is the transaction rate, which specifically includes the following three items:

1. Subscription/Subscription fee Subscription/subscription fees refer to the handling fees charged by investors when they subscribe/subscribe for fund shares, also called front-end charges. The formula for calculating the subscription fee is: Subscription fee = Subscription amount - Subscription amount / (1 + Subscription rate) Fund A will charge different proportions of subscription fees based on the subscription amount, while Fund C will be exempt from subscription fees.

2. Sales service fee Sales service fee is a fee charged during the fund holding period. The sales service fee is accrued daily from the fund assets. The sales service fee is calculated as: sales service fee = net asset value of the fund on the previous day × annual rate / number of days in the year. Fund A is exempt from sales service fees, and Fund C is charged a sales service fee.

3. Redemption fee Redemption fee is a fee charged when investors redeem the fund. The longer the fund is held, the lower the redemption rate. The calculation formula of sales service fee is: redemption fee = redemption share × net value of fund shares on the day of redemption × redemption rate. Fund Class A and Class C both charge redemption fees, but the charging standards may be the same or different.

2. Which fund A or C is more cost-effective? Taking E Fund Fenghua Bond Class A and Class C as an example, the transaction fee comparison chart is as follows: From the fee comparison, it can be seen that holding Class C in the short term will be more cost-effective. It is cost-effective, and Class A will be more cost-effective if you hold it for a long time. There will be a balance point between the two (intersection days), and the balance point of E Fund Fenghua Bonds is approximately 45 days. The above content about which fund A or C is more cost-effective, I hope it will be helpful to everyone. Warm reminder, financial management is risky, so investment needs to be cautious.