Which is more cost-effective to buy funds A and C?
Want to know which fund is more cost-effective, choose fund A for long-term investment and fund C for short-term investment according to the holding time. Because Class A has subscription fee and redemption fee, the longer the holding time, the smaller the redemption fee, and the lowest can be zero; Class C does not charge subscription fees, but there are sales service fees and redemption fees, and the fees decrease with the increase of holding time. If investors don't have any judgment on the investment period, or plan to invest for a long time, then they can consider buying Class A funds. If the firm decision is to make short-term investments, you should choose category C.
Class A bond funds charge front-end fees, while Class C bond funds have no subscription fees. From this aspect alone, many people will think that it is more cost-effective to buy Class C, but when investing, don't just look at one aspect. Class a and class c have their own advantages. As for which is more cost-effective, it depends on the choice and plan of investors.
For example, if you hold it for 30 days to 1 year, the subscription fee is 1.5%, which corresponds to 0.5% redemption fee, totaling 2%. The annual fee of 0.5% takes 4 years to reach Class C, so Class C is more cost-effective than Class A; If you hold 1 to 2 years, the subscription fee is 1.5%, which corresponds to 0.2% redemption fee, totaling 1.7%. It takes 3.4 years for the annual fee of 0.5% to reach Class C, so it is more cost-effective for Class C to compare with Class A. ..
After reading the interesting introduction, I believe everyone knows very well which is more cost-effective to buy class A or class C funds. The short-term cost of Class A is higher than that of Class C, but at the critical point, both costs are the same, and the critical point is about 8 months. The subscription rate of funds is closely related to the expected holding time of investors, so everyone should plan their own funds before buying them.