What is the difference between Class C and Class A shares?
Furthermore, should I buy Class A or Class C shares?
This benefits the investor because Class A shares have lower annual expense ratios than Class B shares. Class C mutual fund shares are best for investors who have a short time horizon and plan on redeeming their shares soon. Investors cannot convert Class C shares to Class A shares, which have lower expense ratios.
Similarly, you may ask, what is the difference between share classes?
The difference between Class A shares and Class B shares is usually in the number of voting rights assigned to the shareholder. Class A shares are common stocks, as are the vast majority of shares issued. When more than one class of stock is offered, companies traditionally designate them as Class A and Class B.
While the current conversions are only designed to limit how long an investor can be parked in a particular C-share class fund, the road ahead could get even rockier. “C shares are going away because they are a bad deal for investors.