Class A and Class C share schtick

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Jan 21, 2011 5:58 pm

I'm green.......very green.  I was hoping to get some insight for a good schtick to explain Class A and Class C shares' fees to potential clients.  My OSJ is a deucher....so I'm trying here.  I would also like to know which shares are better for me to sell to make money(I know about the clients investment time horizon is important)  Just not exactly sure how I get paid selling C shares.   Thanks for your time.....

Jan 21, 2011 8:27 pm

B shares are the best way to go.

Jan 21, 2011 9:19 pm

+1 on the B shares, best of both worlds.

Jan 21, 2011 10:30 pm

It is scary that you have the ability to sell something that you know nothing about!! 

Jan 21, 2011 11:42 pm

Run Hypos on all classes then let them tell you what they want to buy. Compliance will love you for it.

Stok

Jan 22, 2011 8:49 am

Why does my OSJ say not to sell B shares?  Hypos is a good idea, thanks Stok.   Oh...I am Legend...go f#*k yourself.  I know how to set up a client and the charges, I was wondering how I get paid.  And I was looking for a good example to discuss fees with the clients thats it.  You have nothing good to say, keep your trap shut. 

Jan 22, 2011 9:44 am

Wow, you don't know how you get paid on C shares. Really????

Jan 22, 2011 9:51 am

If you buy the A share, I eat steak tonight but may starve tomorrow.  If you buy the C share, I eat bologna for as long as you own the fund.

Jan 22, 2011 10:49 am

My OSJ tells me nothing business horn, so far I have only sold A's I understand the 5.75 sales charge and all that.  Its just the higher 12b-1 on C's right? And maybe 1% back end if sold before a year?   

Jan 22, 2011 12:05 pm

1% back if you sell and take the money out of the fund family within a year. You can sell and move the money to the fund family money market.

I Am Legend is right - no disrespect - but how can you not know the difference between A and C? How can you not know how you get paid?

Jan 22, 2011 1:08 pm

My firm requires a disclosure to be signed that is attached to the FINRA Mutual Fund analyzer.  This shows the client the difference in sales charges and fund expenses over time between A and C share classes.  We are not permitted to sell B shares at all, and we are not permitted to sell an C share over $50,000, even if the client agrees to the disclosure.   A shares and managed money are the lay of the land. 

I know this doesn't directly answer your question Multifun, but I thought a little perspective on other programs might be useful.  I work in a bank program.

Jan 22, 2011 3:33 pm

[quote=Multifun]

Why does my OSJ say not to sell B shares?  Hypos is a good idea, thanks Stok.   Oh...I am Legend...go f#*k yourself.  I know how to set up a client and the charges, I was wondering how I get paid.  And I was looking for a good example to discuss fees with the clients thats it.  You have nothing good to say, keep your trap shut. 

[/quote]

If you know so much, why are you asking on here?

C shares are a pay as you go strategy if the client wants the flexibility to have several fund families.  Normally, you get 1% upfront and a 1% trail except some bond funds and a few balanced funds pay .65% or .75% trail.  The trail starts in month 13.  Really in the current environment you are better off going into fee based rather than C shares if the client will due to the uncertainty of the c share trails going forward.

B shares you basically can't do anymore.

A shares are appropriate for someone younger who doesn't mind paying something upfront for lower underlying expenses, but they are limited to the fund choices of that fund family.  A you get paid more upfront and C and fee you get paid more over the long run. 

Jan 22, 2011 3:37 pm

Thanks Ice and enigma, that's very useful.  I don't get upset over those other d-bags. They just hide behind a screen name and think their hot sh*t, it's actually pretty funny.  Thanks again for the info and perspective.

Jan 22, 2011 3:47 pm

Are you as gay as your picture??

Jan 22, 2011 4:08 pm

MF, I hope you found what you were looking for

Jan 22, 2011 5:02 pm

Me too.  I was just welcoming you to the forum by preparing you for reality on here.

Jan 22, 2011 5:44 pm

LOL Legend.....been on forums before and I know what they are all about.  I know you get people like yourself hiding behind a screen name talking all tough, it's pretty funny to read.  I put up the picture for a little humor and it clearly went over your head...I'm sure your a good dude, you just come off sounding like a duche bag.  Thanks for the reality check.

Jan 22, 2011 8:45 pm

You're going to be a huge success in this business, Multifun

Jan 23, 2011 7:48 am

WTF?  Do people not take the Series 7 anymore? 

Jan 23, 2011 11:16 am

Most firms don't allow, or are moving away from B shares, so disregard the guys messing with you above.  Looks like you've got the information above to understand the difference.  I would read the page in the prospectus that talks about fees.  It really is just a page or 2, and you'll understand exactly what you are selling.  As far as getting paid on C shares, it is essentially 1% up front to your grid, and multiply by your payout.  After year one, you'll likely get .25% to your grid quarterly.