EASY MOVEMENT FROM ONE FUND TO ANOTHER IN THE SAME FAMILY
Learn even more about this topic with the Encyclopedia of Personal Finance™
Very often, mutual funds belong to a larger "family of funds."
That is, a company may hold several mutual funds, such as a growth fund, a
balanced fund, a bond fund, a money market fund, etc. You can exchange one
mutual fund for another in this family. However, for tax purposes, an exchange
is viewed as a sale and purchase.
Fund families allow shareholders to exchange shares of one fund
for another in the family without an additional sales charge. However, some
funds may charge a small, flat exchange fee for this service.
And now, some final words.