12b-1 Fee

One of many charges that mutual funds levy on money invested. It was created in 1980 under authorization of the SEC. It's purpose is to allow marketing expenses to be paid out of the fund's assets. This is supposedly good for the investors in that respect that it will allow the fund to get more investors. Also some no-load funds charge 12b-1 fees, that is supposedly going to pay for distribution and marketing of the fund. No load funds that do not charge any12b-1 Fee are called 100% no-load or true no-load funds.

 

 

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