Oct. 8, 2002 — American Century Investments will add sales charges to some of its mutual funds early next year in an effort to increase sales through financial intermediaries.
The company will introduce Advisor class shares, which will be sold only through brokers, financial planners and other third parties, for nine stock and bond funds, and a money market fund, in February. The funds will also carry redemption charges. In addition, they will carry marketing and distribution, or 12b-1 fees, which compensate intermediaries who sell the products.
In announcing the switch, American Century noted that more than 85% of mutual funds are sold through intermediaries. “We want to do business with people in the way that they want to do business with us, whether that’s (directly) or working with a financial intermediary,” company spokeswoman Lauri Kouri said.
About 50% of the firm’s business comes from investors who purchase shares directly from the company, and third party sales generate 35%, Kouri said. Institutional and retirement plan sales account for the rest, she said.
The funds for which new share classes are being introduced have about $13 billion in assets, Kouri said. They include the $3.4-billion American Century Select/Inv (TWCIX), the $2.7-billion American Century International Growth/Inv (TWIEX), and the $1.9-billion American Century Value/Inv (TWVLX).