Share Class Pricing Details - American Funds (2024)

FAQs

What is my share class? ›

A share class is a designation applied to a specified type of security such as common stock or mutual fund unit. Companies that have more than one class of common stock usually identify a given class with alphabetic markers, such as "Class A" shares and "Class B" shares; these carry different rights and privileges.

If you sell (redeem) Class C and 529-C shares before you hold them for 12 months, you will pay a 1% sales charge on the shares that you sell. This is called a contingent deferred sales charge, or CDSC. In some situations, your redemption will not be assessed a CDSC. Our fund prospectuses provide more details.

It markets its funds by compensating traditional brokers and financial advisors with commissions. To pay these commissions, its funds charge a combination of front-end loads, back-end loads, and higher expense ratios.

The type of shares and share classes that a company can create is determined and guided by its articles of association, also referred to as articles of incorporation. Shares classes that are created by a company carry ownership restrictions and confer different rights and privileges to diverse shareholders.

Class A shares generally have more voting power and higher priority for dividends, while Class B shares are common shares with no preferential treatment. Class C shares can refer to shares given to employees or alternate share classes available to public investors, with varying restrictions and voting rights.

Investors generally should consider Class A shares (the initial sales charge alternative) if they expect to hold the investment over the long term. Class C shares (the level sales charge alternative) should generally be considered for shorter-term holding periods.

1. The conversion of Class C shares into Class A shares—which, prior to January 22, 2021, happens automatically approximately 10 years after purchase and, starting on or about January 22, 2021, happens automatically approximately 8 years after purchase—is not a taxable event for federal income tax purposes.

Class A shares may impose an asset-based sales charge (often 0.25 percent per year), but it's generally lower than the charge imposed by the other classes (often 1 percent per year for Class B and Class C shares).

Overall, American Funds Mutual Fund A ( AMRMX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, American Funds Mutual Fund A ( AMRMX ) looks like a good potential choice for investors right now.

What is the best American Funds mutual fund? ›

The fund has returned 0.80 percent over the past year, 9.49 percent over the past three years, 7.60 percent over the past five years, and 8.44 percent over the past decade.

Instead of a load, investors who purchase Class C shares pay an annual fee. Plus, they pay a high 12b-1 fee. Therefore, the expense ratio for a mutual fund investment in Class C shares can be high, as well. Over time, the annual fee will cut into investors' returns.

Financial consultants working on a commission basis have to drum up a minimum amount of brownie points annually, or they're fired. American Funds usually pay the most points per dollar of sale, just like the conference brownies. So they're naturally favored by advisors fighting to survive (because of "low production").

And while investment results vary, the equity-focused American Funds have generated strong results versus peers, with our funds having beaten their Lipper peer indexes in 81% of 10-year periods and 95% of 20-year periods as of December 31, 2023.

For example, when a private company goes public, it might issue Class A shares to new investors while granting existing stakeholders Class B shares. This structure allows original owners to sell most of their stake while retaining control through Class B shares, which usually carry extra voting rights.

In finance, a share class or share classification are different types of shares in company share capital that have different levels of voting rights. For example, a company might create two classes of shares class A share and a class B share where the class A shares have fewer rights than class B shareholders.

What Is a Class of Shares? A class of shares is a type of listed company stock that is differentiated by the level of voting rights shareholders receive. For example, a listed company might have two share classes, or classes of stock, designated as Class A and Class B.

Investors generally should consider Class A shares (the initial sales charge alternative) if they expect to hold the investment over the long term. Class C shares (the level sales charge alternative) should generally be considered for shorter-term holding periods.