Final answer:
Class C shares allow investors to trade at NAV and have a 12b-1 fee that can be as low as 0.25%. Unlike Class A, B, and D shares, Class C shares offer consistent 12b-1 fees along with the flexibility of trading at NAV.
Step-by-step explanation:
The type of shares that allow an investor to buy and sell shares at net asset value (NAV) and carry a 12b-1 fee of 0.25% are Class C shares. Class A shares typically have a front-end load, meaning investors pay a fee when they purchase the shares. Class B shares usually have a contingent deferred sales charge (CDSC), which is a fee charged when the shares are sold, and these fees tend to decrease the longer the investor holds the shares. Class D shares are often a lower-cost option for investors purchasing shares through a brokerage platform, and these may have lower 12b-1 fees but do not necessarily allow purchase and sale at NAV.
Therefore, Class C shares differ from the other classes by providing the flexibility to buy and sell at NAV and by having a fixed 12b-1 fee, intended to cover distribution expenses, of typically 1% but may be as low as 0.25% in some mutual funds.
SUMUP of the final answer:
- Investors can buy and sell Class C shares at NAV.
- Class C shares have a constant 12b-1 fee, which can be as low as 0.25% in some cases.
- Class A, B, and D shares have different fee structures and do not offer the same terms as Class C shares.