The 12b-1 fund bears the 12b-1 commission, which covers the fund’s selling and distribution costs.
This fee is a percentage of the fund’s market value, as opposed to funds that charge a download or sale fee.
Fees under 12b-1 include expenses for marketing and selling fund units, fees to brokers and other sellers of funds, and promotional expenses such as printing and mailing fund prospectuses to investors.
The once popular 12b-1 funds have lost investor interest in recent years, especially as exchange-traded funds (ETFs) and low-cost mutual funds rise.
A floating rate fund is a fund that invests in financial instruments with variable or floating interest rates. A floating rate fund invests in bonds and debt instruments, the interest payments on which fluctuate depending on the level of the base interest rate.
Go-go fund - a mutual fund with an investment strategy focused on growth stocks and other high-risk securities.
These funds were at their peak in the 1960s, attracting investors with the promise of unusually high market returns.