Share classes.

In plain English

One investment, several wrappers. For mutual funds, share classes (A, C, institutional, and others) hold the identical portfolio but charge different fees: some add sales loads, some carry higher ongoing costs, some are cheap but require big minimums or a workplace plan. For stocks, classes usually split voting power: one class might carry ten votes per share, another one vote, another none, while all represent the same company.

01Why it matters

Inside a 401(k) or when comparing funds, the share class is sometimes the entire difference between a good deal and a bad one for the same underlying portfolio.

02The math, step by step

The same stock index portfolio offered as an A share with a 5.75% upfront load and 0.55% expenses, and as an institutional share at 0.04% with no load. $10,000 in: the A share starts at $9,425 and loses more every year. Same holdings, different door.

Illustrative example. The amounts here are hypothetical, chosen to show how the math works, not real quoted rates or figures.

03What this is NOT