trailing commission

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Trailing Commission

A commission that the salesperson of a mutual fund receives each year an investor remains a shareholder. That is, the salesperson receives the first trailing commission when the investor first buys shares in the fund, and a new trailing fee each year thereafter. Critics of this practice point out that it can create a moral hazard that the salesperson will aggressively sell a fund because of his own financial incentive, rather than because he believes it to be a good investment for the potential shareholder. Not all mutual funds pay their sales staff trailing commissions. A trailing commission is also calling a trailer fee. See also: Load.

trailing commission

A commission paid annually to a sales agent for as long as a client's money remains in an account. Also called trailer fee.
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Commissions, trailing commissions, management fees and expenses may all be associated with mutual fund investments.
In its recommendations, the Royal Commission had urged authorities to abolish trailing commissions paid to mortgage brokers during the term of a property loan.
Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments.
My understanding is that we'll be able to continue to receive trailing commissions for advice provided prior to the rule's effective date in April 2017.
But scratch below the seemingly successful surface and you may find a practice with poor persistency (and weak trailing commissions), limited cross sales, and a lousy reputation in the community.
There may be commissions, trailing commissions, management fees and expenses associated with mutual fund investments.
During the period, for instance, sales commissions and net recruiting "slowed," and lower asset levels "reduced trailing commissions, advisory fees and asset-based fees."
Advisors that were earning trailing commissions on bundled, pre-RDR investment products are also impacted by the new rules.
Typically, trailing commissions -- the commissions from unfinished deals that follow a broker when they switch firms -- are "rife with concerns," said Laurie McPherson, a partner at the law firm Blank Rome.
This may include so-called 12(b)1 fees, trailing commissions, surrender charges and back-end fees.
It will also suggest changes to outlaw grandfathered trailing commissions.