Insight February 2010 Monthly Update

For years, trailer fees have united the funds industry with the dealer community. But things are changing, and changing to such an extent that the happy marriage may become a rocky relationship. In the February issue of Insight, we tackle the trailer fee issue and examine the drivers of change, including the demand for lower investor costs at a time of low returns; the push for greater transparency; the competition from lower-cost alternatives; and other advisor compensation models. The financial impact of these changes on the operating margins of manufacturers, dealers and advisors is also covered in this important study. The research article also looks at: – The level of compensation related to mutual funds and competing products on the fee-based product continuum – Estimates of the amounts and trailer fee levels paid to advisors and distributors – The makeup of trailer fees by asset class – The dynamics of mutual fund revenues on the full-service and MFDA platforms – Trailer fee levels for the various load types – Trailer fee levels for the banks’ Advisor series and independent fund manufacturers