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Mutual Fund Fee Structures and Broker Compensation

Author

Listed:
  • Lonnie L. Bryant

    (The University of Tampa Finance Department)

  • Maureen Butler

    (The University of Tampa)

  • Zhongling Cao

    (The University of Tampa)

Abstract

The mutual fund fee structure varies substantially across funds, a major variable being whether a contract imposes a fixed fee or marginal fee structure. This paper examines how the use of a fee structure affects broker compensation, investor investment decisions and broker benefits. Theory suggests that marginal fee contracts are the results of either economies of scale or non-linear fund performance. The intent of this study is to understand if the fee structure framing has a significant economic effect on broker compensations. Furthermore, to understand if fund inflows as well as fund performance are directly influenced by fee structure.

Suggested Citation

  • Lonnie L. Bryant & Maureen Butler & Zhongling Cao, 2018. "Mutual Fund Fee Structures and Broker Compensation," Annals of Economics and Finance, Society for AEF, vol. 19(1), pages 197-211, May.
    • Handle: RePEc:cuf:journl:y:2018:v:19:i:1:bryant:butler:cao
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    mutual fund; broker; governance; fees;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • G3 - Financial Economics - - Corporate Finance and Governance
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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