Investor Glossary-12b-1Investor Glossary-12b-1Investor Glossary-12b-1Investor Glossary-12b-1Insightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

12b-1

The HTML to link to this page
 

12b-1 refers to the fees mutual funds pay for marketing the fund. The name 12b-1 is a reference to the section of the Investment Company Act of 1940 that allows mutual funds to pay distribution and marketing expenses out of fund assets. The SEC permits 12b-1 fees to be charged under the theory that marketing increases fund assets and benefit investors indirectly through better absorption of fund expenses. The SEC limits 12b-1 fees to one percent annually with a maximum of 0.25 percent going to brokers. Critics say the 12b-1 fee can be used as a hidden load with A and B class shares having different 12b-1 fee structures. Funds that charge 12b-1 fees of less than 0.25 percent per year may be marketed as "no-load". The best way to avoid paying 12b-1 fees is to check the fund prospectus. The SEC requires funds to disclose their 12b-1 fees in the list of fees in the prospectus.



Rate this 12b-1 definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: balance sheet, Zero Cost Collar, LIBOR, implied volatility, wholly-owned subsidiary, inflation, per diem, Key Rate Duration, open position, limit order, 144a, ex-dividend, covered put, EBITDA, option premium, retained earnings, annual return, quality assurance, diluted share, labor relations, ex-dividend date, 401a, average price per share, deferred revenue, 1035 exchange, risk management, in escrow, command economy, required rate of return, liquidity ratio, minority interest, cancelled check, current ratio, reverse mortgage, FTSE, 1031 exchange, real GDP, FICO score, stock split, irrevocable trust, margin rate, APR, VIX, phantom income, stock market close, deferred tax, dividends payable, debt service coverage, class C shares


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Investor Glossary | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2015 Investor Glossary - All rights reserved - Terms of Use