Question

An annual fee charged by a number of open-end mutual funds that's supposed to be used to offset promotion and selling expenses is called the

Answer 1

The annual fee that is charged mutual funds to offset promotion and selling expenses is known as 12(b)-1 fee.

Basically, the term "12b-1 fee" refers to the distribution and service fees charged by mutual funds on an annual basis.

• The 12b-1 fee is used to cover the costs of marketing, selling fund shares, providing shareholder services etc.

In conclusion, the annual fee that is charged mutual funds to offset promotion and selling expenses is known as 12(b)-1 fee.

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