In present situation, very few AMC(S) HAVE increased exit load for some equity oriented schemes.. We all know and have experienced that no one scheme can remain no-1/2/3 - rather in first quartile-- in all evaluated periods.. SIMULTANEOUSLY all peer group schemes having same mandate & to operate in same segments of equity market have equal chances of being in first quartile. -- The future ranking is unknown..
What is ethical to advise?
IFA shall consider costs of scheme too, while advising.. and avoid high loads/costs schemes if ALTERNATIVES ARE AVAILABLE-i.e.--other factors are same for peer group schemes.. ADVISING HIGH LOAD SCHEME MAY CREATE DOUBTS THAT IFA HAVE VESTED INTEREST OR HE IS SACRIFICING INVESTOR'S INTEREST.
The argument offered by AMC(S) HAVING HIGH LOADS :-' EQUITY INVESTMENTS SHALL BE FOR LONG TERM '- STANDS APPLICABLE TO ALL EQUITY SCHEMES.. AMC must justify its high load by establishing solid reason (special feature) of its scheme for extra cost-- as extra out - performance can never be guaranteed..
Please post your views.. If agreeable with me, avoid high load schemes sothat AMC think it seriously while taking deviating steps...