A new bill making the rounds in Congress could eliminate mutual fund C-class shares, MarketWatch
's Chuck Jaffe speculates
The Investor Protection Act of 2009
, which has passed through the House
Financial Services Committee but has not yet made its way out of Congress, would implement stricter fiduciary duties for brokers acting as advisors.
To Jaffe, those new responsibilities would make it difficult for these brokers to justify selling Class C shares, which typically forego sales loads and charge higher annual expense ratios. Thus, these classes would be the least attractive to long-term investors.
"This should give rise to the end of the C share, and the whole concept of loads is going away too; any loaded funds will become more the exception than the norm," Geoff Bobroff
of Bobroff Consulting
in East Greenwich, R.I., told Marketwatch.
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