Submitted by nsscadmin on
Last week we started our look at mutual funds’ series with Series A funds and Series B &C funds. This week we continue with a look at Series D mutual funds. As we noted last week, while the series we are highlighting are the most common types of mutual funds series offered by investment firms, there is no standard by which investment firms must use letter designations for specific mutual fund classes. Be sure to check the prospectus and/or fund fact sheet to see what letter designations your investment firms use and what they mean.
Series D funds, also know as Discount Series funds, are created specifically for self-directed investors who purchase mutual funds through an online or discount brokerage. One key piece of information about online or discount brokerages is that since they offer self-directed investing, they do not offer investment advice. This lack of advice means that Series D funds have a reduced trailing commission, or in some cases, no trailing commission at all. Series D funds typically have a lower management expense ratio (MER) than Series A funds. However, a lower MER does not mean the fund will always provide better returns. Always do your research and due diligence before purchasing any fund to make sure it fits your risk tolerance and financial goals.
