hose who want to hop out of the Heartland Value Fund
or Heartland Value Plus
within 270 of purchase will now pay a 1% redemption fee, according to the Milwaukee-based $2.8 billion fund family.
With day trading and market timing firms increasing in popularity, investors seem to be clicking their mouse more than ever. The additional fee is a move being made to discourage market timers who rack up transaction costs and disrupt the management of a fund's portfolio.
Market timing can be particularly hard on small-cap funds because frequent redemptions can force the portfolio manager to sell stocks at below market price.
The $1.3 billion Heartland Value Fund appeared to be the main target, according to the company, due to its age and solid performance.
Redemption fees are growing in popularity as a means of coping with market timers. Other funds that have recently added fees include the Invesco, Montgomery, Oakmark, Strong, and Vanguard fund families.
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