How to Pay Advisors
Mutual Funds Magazine (11/02) Vol. 8, No. 11 p.26; Damato, Karen

The Securities and Exchange Commission requires fulcrum fees to be equal, meaning that advisors receive or be penalized the same percentage depending on how mutual funds perform. The number of funds using fulcrum fees has increased from 40 in 1990 to 108 in 1999, and critics are concerned that the fees are useless. According to experts, the fees help fulcrum fee-based funds beat out their competitors by one percent annually, but the fulcrum funds fail to perform better than their own benchmarks.


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