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I know I'm coming out of left field (or is it right field ) on this, but I don't think that multiple share classes is that big a deal. Sure they're there to be deceptive, but that doesn't mean the information isn't out there, in plain sight, to make the best share class decision. (The writers don't object to loads, just to multiple share classes.)
All you need, if you're working with a broker, is someone who has a fiduciary duty to act in your best interests, as opposed to finding suitable (but not best) share classes. The writers started by dismissing this obvious solution ("eventually we will all recognize the appropriate choice").
FXAIX is given as an example of a rock bottom-priced index fund. There are no administrative costs for this fund because it is only available in employer plans where "Fidelity provides recordkeeping services". (From prospectus, the reading of which they poo-poo.) Once you add back those (profit making) administrative fees, you realize that total cost of this fund is not so cheap after all.
They make Rydex and Invesco funds sound worse than they are by omitting details for these funds also.
IMHO, they're fighting the last war. Most fund families have already closed B shares. The new front is wrap accounts. With these accounts, brokers charge 1%/year (i.e. at least as high as they got from commissions/trailing fees) and use fund supermarkets (where the funds are paying undisclosed fees to the supermarkets for shelf space, and passing these costs onto the investor).
Comments
All you need, if you're working with a broker, is someone who has a fiduciary duty to act in your best interests, as opposed to finding suitable (but not best) share classes. The writers started by dismissing this obvious solution ("eventually we will all recognize the appropriate choice").
FXAIX is given as an example of a rock bottom-priced index fund. There are no administrative costs for this fund because it is only available in employer plans where "Fidelity provides recordkeeping services". (From prospectus, the reading of which they poo-poo.) Once you add back those (profit making) administrative fees, you realize that total cost of this fund is not so cheap after all.
They make Rydex and Invesco funds sound worse than they are by omitting details for these funds also.
IMHO, they're fighting the last war. Most fund families have already closed B shares. The new front is wrap accounts. With these accounts, brokers charge 1%/year (i.e. at least as high as they got from commissions/trailing fees) and use fund supermarkets (where the funds are paying undisclosed fees to the supermarkets for shelf space, and passing these costs onto the investor).
Here's my earlier post on that (updated to link to Schwab's 2015 fee disclosure).
http://www.mutualfundobserver.com/discuss/discussion/comment/46916/#Comment_46916