What are breakpoints for mutual funds?
A breakpoint is the dollar amount for the purchase of a load mutual fund’s shares that qualifies the investor for a reduced sales charge. Breakpoints offer investors a discount for making larger investments. The purchase may either be made in a lump sum or by staggering payments within a specified period of time.
Do mutual funds have breakpoints?
Investors can qualify for breakpoints through a single purchase of Class A mutual fund shares, with a letter of intent (LOI) or through rights of accumulation (ROA).
Do Class C mutual funds have breakpoints?
As explained below, many mutual funds offer volume discounts to the front-end sales charge assessed on Class A shares at certain pre-determined levels of investment, which are called “breakpoint discounts.” In contrast, Class B and C shares usually do not carry any front-end sales charges.
How much overlap is acceptable in mutual fund?
A can invest in about 15% of mid caps and B can inevst in about 30% of large cap stocks. So the overlap could be about 40%. This however will not be permanent. There is nothing wrong if this happens as it is beyond the control of the investor.
What is breakpoint schedule?
Breakpoint schedules are levels set by the mutual fund that allows an investor to receive a sales load discount. Discounts from breakpoints are typically applied to funds with a front-end sales load, but they could be applicable to all shares of a fund.
What is a breakpoint analysis?
Break point analysis is a way of looking at customer satisfaction data to determine when there are shifts or breaks in satisfaction levels. In the doctor’s office visit example, how long are patients willing to wait while still experiencing a high level of satisfaction?
What is an F class mutual fund?
F-class funds are low-fee versions of mass-market load mutual funds. They are sold to investors primarily by investment advisors and financial planners who charge their clients on an assets-under-management basis rather than by the individual transaction.
What is the most aggressive type of mutual fund?
Besides those, there are also categories of bond funds, money market funds, and global and international funds. Additionally, there are multiple asset class funds such as balanced, allocation and target-date funds. Aggressive growth andsmall-cap funds are among the most aggressive equity funds.
What is a breakpoint sale violation?
A breakpoint sales violation occurs when a registered rep sells mutual fund shares to a customer in an amount just below the level at which the investor would qualify for the reduced sales change.