20 How does buying funds directly compare with buying through a broker?
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This article is from the FAQ, by with numerous contributions by others.
20 How does buying funds directly compare with buying through a broker?
A load fund usually costs the same whether bought directly or
through a broker. A no-load fund can be bought directly at no
charge; most brokers will charge a commission to buy a no-load
fund. Some discount brokers now offer some no-load funds at no
transaction fees; normally, they receive a portion of the funds'
annual expenses instead. Holding funds in a broker may make it
easier to trade from one fund to another, however. Closed-end
funds usually need to be traded through a broker, like regular
stocks, though some have dividend reinvestment plans.
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