Rule 12b-1 fee

Definition

An extra fee charged by some mutual funds to cover promotion, distributions, marketing expenses, and sometimes commissions to brokers. A genuine no-load fund does not have Rule 12b-1 fees, although some funds calling themselves "no-load" do have Rule 12b-1 fees (as do some load funds). Rule 12b-1 fee information is disclosed in a fund's prospectus, is included in the stated expense ratio, and is usually less than 1%. also called 12b-1 fee.

Use Rule 12b-1 fee in a sentence

The Rule 12b-1 fee was a necessary fee to be paid by the investor as he was aware there would be many fees.

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You should always make sure that you are not doing anything that may be breaking any rule 12b-1 fee or you could get in trouble.

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We got hit with an unexpected Rule 12b-1 fee, but other than that there were no surprises lurking in store and our financials ended up looking good.

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