SIE practice questionhardMutual Funds - Share Classes
A key disadvantage of Class B mutual fund shares compared to Class A shares is:
- AHigher minimum initial investment
- BImmediate front-end load payments
- CEligibility for the same front-end breakpoint discounts as Class A shares
- DInvestors may pay higher overall fees if holding long-term✓ Correct answer
Explanation
Why D — Investors may pay higher overall fees if holding long-term
Class B shares avoid front-end loads but can carry deferred sales charges and higher ongoing expenses, which may produce higher overall costs for long-term investors. Class A shares may qualify for breakpoints.
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