Products & Their RisksQuestion 65 of 398
An investor wants to invest a modest amount for only about two to three years. Which share class is often most appropriate?
a.Class C shares, because of no front-end load and a short-lived, small back-end charge
b.Class A shares, to capture breakpoint discounts
c.Class B shares, to benefit from a long declining CDSC schedule
d.No-load shares are prohibited for short horizons
Explanation
Class C shares typically carry no front-end load and only a small contingent deferred sales charge that lapses after about one year, but they have a higher ongoing 12b-1 fee. For a small, short-term investment, avoiding the front-end load makes Class C often more suitable than Class A or B.
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