Question for MER brokers
Rumor is that MER reps don’t get paid on trails from mutual funds. As someone with a fair amount of trails this will seriously impact my revenue. Is it true?thanks for the help, NX
[quote=harshworld]We get paid trails but no 12b1 fees[/quote]
What does that mean?
Maybe i am missing something but arent trails on MF’s actually 12b-1 fees that are paid to the broker?
I'm thoroughly confused by that statement as welll...12b-1 fee = trail.
Maybe he means that in an advisory/fee-based account, the client gets 12b-1s rebated back to them?[/quote] Probably what he means. However, if he is currently charging 1.25, and ALSO gets 25 bips sent to him, then I guess he would be losing 25 bips if he moves, unless he charges the clietns 25 more. Jones' advisory program also rebates back the 12b-1's and revenue sharing.
According to Merrill 12b-1 fees can be a form of trails. But trails are not necessarily 12b-1 fees. In most cases trails at Merrill are considered the the management fees. Furhter in most cases when we use mutual funds we put them into a wrap account and Merrill keeps 12b-1 fees and the broker gets a percentage of the management fee but not the 12b-1 fees. The 12b-1 fees are not considered in the management fees so we do not get to add in the 12b-1 fees when calculating payouts on our grid.
Hopefully this helps clear any confusion from my previous post.