Class A, class P?

weezie_2

Whats the difference between Class A & Class P units, specifically for BlackRock UK Absolute Alpha fund?
Sure I've seen a Class X somewhere as well... what does the letter indicate?

JDinho

Read the Fund's prospectus that will tell you the difference

weezie_2

Yeah... that had occurred to me, but it didn't seem to offer much info (http://www.fundslibrary.co.uk/fundslibrary.dataretrieval/Documents.aspx?sedol=B11V7T6&type=packet_fund_doc_reports_and_accounts&user=hl_web_test)

I thought must be some kind of shorthand for how a fund opperates?

Aegis

weezie wrote: »

Yeah... that had occurred to me, but it didn't seem to offer much info (http://www.fundslibrary.co.uk/fundslibrary.dataretrieval/Documents.aspx?sedol=B11V7T6&type=packet_fund_doc_reports_and_accounts&user=hl_web_test)

I thought must be some kind of shorthand for how a fund opperates?

I think it's to do with the target investors. Certain classes are for certain types of investors, eg personal, institutions, pensions, etc. I may be wrong though!

Ian_W

It's some time since I read up on the BlackRock fund but IIRC class A were launched for institutional investors almost 3yrs ago and class P was introduced for retail investors about a year later when the concept was, to a degree, tried and tested and they started daily pricing.

AFAIK class X is only used by M&G and denotes a fund has no initial fee but there is an exit fee if you switch or sell out of it before a certain time frame though I can't remember how many years or whether that varies from fund to fund.

EDIT to add from M&G website:
Class X Shares - How to invest with no Initial Charge
Some of the funds available within The M&G ISA have Class X Shares. Class X Shares allow you to invest with no initial charge but with a diminishing exit fee which disappears completely after five years. Please remember that there may also be an annual management charge.

weezie_2

Ahhh, starting to mak sense. So you figure out which fund/s you like the look of, then check the small print on the 'class' before you buy to make sure they're not off-putting, but in practice it probably doesn't make much difference.
If different classes are aimed at different types of investor, that explains why the same class tends to come up on HL, moringstar etc. for a private investor.
I guess the underlying fund is basically the same & invested in the same way, it's just the conditions attached that vary.
Thanks for your help

JDinho

Class A units are not available to new investors after 01/09/07 - regular investors buying the units can still do so

Class P units are the only retail units.

Class A = allows for income to be distributed

Class P = income is accumulated within the fund reflected in its price, not an increased amount of units

Class A = AMC is 1.75%
Class P = AMC is 1.50% & 20% Performance Fee based on Hurdle pegged to 3m LIBOR & a High Water Mark ensuring that the fund is positive over a 1 year period

... and so on!!!