October 23, 2010
A step in the right direction but these 12b-1 fees should be eliminated.
These fees should be banned on three principal grounds: (1) they do not benefit existing shareholders (the owners of the fund), (2) they are insufficiently transparent to mutual fund shareholders, and (3) they hit all shareholders of any fund share class that imposes them, potentially for years after the shareholders make any investment in the fund, even those who don't benefit from the advice that the 12b-1 fees are intended to provide.
Worse of all, some of these hoses are charging 12b-1 fees on index funds What is next?