Fee-Based Investment

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Fee-Based Investment

A fund or portfolio where the money manager is paid a percentage of the fund or portfolio's market value rather than commissions based on the number of transactions conducted. Fee-based investment is thought to better align the incentives of investors and money managers; specifically, money managers have a reason to provide increased value for the investment. Fee-based investment also reduces the temptation to overtrade simply to extract higher commissions.
References in periodicals archive ?
Scottrade is trying to move away from its focus on transactional trading revenues and evolve towards more fee based investment management revenue.
Fee based investment advisory services are offered through Sigma Planning Corporation, a registered investment advisor.