Definition of Mutual Fund Trails


Mutual funds are a popular investment choice, but the terminology of funds can be confusing. Mutual fund trails is not a well known or understood concept.


  • Mutual funds trails, or trail commissions, are a type of commission paid to the brokers who sell mutual funds.


  • Trail commissions are ongoing commissions paid to the broker on assets held in the mutual funds. Brokers usually receive the commission each quarter for their customers' mutual fund accounts.


  • Trail commissions range from 0.25 percent to 1.00 percent annually of the mutual fund balances.


  • The source of mutual fund trails is the 12b-1 fees a fund charges shareholders. The 12b-1 amount can be found in the mutual fund prospectus.


  • High 12b-1 fees can reduce the overall return from a mutual fund. Trail commissions help pay the broker for ongoing mutual fund advice and assistance.

Related Searches


Promoted By Zergnet


You May Also Like

  • About Class C Mutual Funds

    Mutual funds are a popular way for people to invest. By pooling investor money they can diversify across more securities and provide...

  • The Definition of Mutual Fund Distribution

    Mutual funds can hold a variety of stocks, bonds or other securities. When those securities pay dividends or interest, that income is...

  • Mutual Fund Exchange Definition

    A mutual fund exchange is simply a streamlined way to simultaneously buy and sell mutual funds. Not all mutual funds can be...

  • Mutual Fund Complex Definition

    A mutual fund complex is a family of mutual funds. Mutual funds are a diversified investment product that makes it possible for...

Related Searches

Check It Out

4 Credit Myths That Are Absolutely False

Is DIY in your DNA? Become part of our maker community.
Submit Your Work!