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Are any OppenheimerFunds always front loaded 5.75% to get into the fund?

post #1 of 12
Thread Starter 
My Edward Jones advisor just put 10K into my SEP IRA and invested the money into 6 different OppenheimerFunds. He said that these funds come in two flavors.

'A' Funds - are front loaded and that's what he put me into. He said for an investment below 25k it is 5.75% to get into the fund. After 25k it goes down to 5.5% and as the higher you go the less the front loaded percentage is.

'B' Funds - are back loaded, where there is no upfront cost to get into the fund, but you must keep your money in the fund for X amount of years, usually 7 years and if you take the money out before that time, you get hit with 'x' percentage of fees.

My questions are this..

1.) Do you NEED to go through an investment advisor to get into any of the OppenheimerFunds?

2.) Is the 5.75% front loaded fee for these funds normal? or is Edward Jones taking a large cut of this?

3.) Would I be able to invest my money by myself into OppenheimerFunds without paying any of these front loaded fees? I know there are no load funds like Fidelity, Vanguard, etc. but my investment advisor feels that the loaded OppenheimerFunds are giving much better returns. He said the Forbes Magazine listed OppenheimerFunds as the #2 best fund for a 5 year return.

Thanks all!
post #2 of 12
1. ? - I'm not sure if these are offered on the discount platforms (Scottrade/Etrade) but you'd have to pay the load regardless.
2. yes. And Ed Jones is taking all the cut. Shared between the firm and the rep. that's why it's called a loaded fund. In theory, you'll get great service from this guy... In theory...
3. no

Ed Jones....hhhmmmmmm.

You could have probably done a wee bit of research and bought great no load funds in your Scottrade account. I guess I don't need to respond to your PM lol

Stay away from B shares. Internal expense ratios as compared to As are much higher. the rep makes about the same regardless of A or B. It's probably a 4 to 5 year period where it's cheaper to hold the A than the B because of the higher exp. ratio.
post #3 of 12
which Oppenheimer funds did he put you in?
post #4 of 12
Thread Starter 
my edward jones rep said they most all the front loaded 5.75% goes to the OppenheimerFund directly..
post #5 of 12
Thread Starter 
I will know which funds I am in a bit later today when he invests the money today. He wanted to get me into these funds before the stimulus bill gets passed because he feels that once the bill is passed we are going to see a 2K point jump in the dow. I know he is diversifing me into metals, blue chips, foreign markets, etc. He said there are 6 different Oppenheimer Funds that he is putting me in.

why are Oppenheimer Funds front loaded with fees and other funds like Fidelity, Vanguard, etc. are not? does the front loaded funds nowadays mean they are better in returns? my advisor said that some years ago, Fidelity and Vanguard no-load funds were doing very well and he would have recommended those funds back then, but today he said the no-load funds do not perform nearly as well as the load funds.
post #6 of 12
Quote:
Originally Posted by squale View Post
I will know which funds I am in a bit later today when he invests the money today. He wanted to get me into these funds before the stimulus bill gets passed because he feels that once the bill is passed we are going to see a 2K point jump in the dow (FALSE). I know he is diversifing me into metals, blue chips, foreign markets, etc. He said there are 6 different Oppenheimer Funds that he is putting me in.

why are Oppenheimer Funds front loaded with fees and other funds like Fidelity, Vanguard, etc. are not? does the front loaded funds nowadays mean they are better in returns? my advisor said that some years ago, Fidelity and Vanguard no-load funds were doing very well and he would have recommended those funds back then, but today he said the no-load funds do not perform nearly as well as the load funds.
Oppenheimer is loaded because they are sold by financial professionals, who should support you on making changes when needed. Fidelity and Vanguard are no load, which typically mean you will not get support from a professional (in a commission based situation.)

We work on a fee-basis, so we buy institutional and no load shares to keep costs low, while charging the client a fee to help make decisions. What I've found is that reps who get 5% up front commissions will "be around" for about a year or so, and then their advice will be non-existant...unless you are sending them more money.

I wish you would've waited. I would've been happy to hook you up with some great funds on the Scottrade platform for no cost.
post #7 of 12
Quote:
Originally Posted by squale View Post
my edward jones rep said they most all the front loaded 5.75% goes to the OppenheimerFund directly..
NOT TRUE. That 5.75% is how he gets paid. That $575 (on a $10K investment) hits his "grid" in which he'll make about 50% or so. the rest stays with Ed Jones.
post #8 of 12
Thread Starter 
oh okay because I just called Oppenheimer direct and they said the same thing that if I went direct through them to open an account with 10K that any funds in equities would be 5.75% front loaded and any BOND-only funds would be something like 4.5% front loaded. So I wouuld think that the commission to Edward Jones would be passed through to Oppenheimer??

btw.. when are mutual funds bought and sold? only 1 time per day at the end of the close of markets? so if I buy the funds today, do I get it for the opening price today or at the closing price of today? for instance if the markets go up a lot today, do I get the price at 4pm today after the markets already went up?
post #9 of 12
if you went direct, Oppenheimer would keep the 5.75% because there's no rep involved.

The 5.75% load is what's used to entice the rep to sell the product. This is how the rep gets paid....

they are bought and sold at day's end. they mark-to-market at close and that's the price you pay. So, yes, you get the price AFTER the market went up. In theory, today's not the best time to buy. Unless the market continues to go up from here...
post #10 of 12
Thread Starter 
well do you think that the market will go up after the stimulus is passed?

and are you an independent financial advisor or you just do this for hobby?
post #11 of 12
I'm not sure what I think the stimulus will do to the market. there could be a short term bump but we're going to hover between 8-9K until mid-summer (IMO).

I am an independent advisor. have been in the business since 2006.
post #12 of 12
xxx
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