More mutual fund companies are charging 401(k) participants for moving money around in their plans, The Wall Street Journal reports.
Vanguard Group, which has long charged individual investors in many of its funds a 1% fee if they sell shares within a year of purchasing them, is to extend these fees to retirement plans beginning Dec. 31.
"Fees could potentially be triggered by annual rebalancing of 401(k) portfolios, but many plan participants don't rebalance within a year," said John Demming, Vanguard spokesman.
Employees enrolled in company retirement plans used to fly under the radar when trading in and out of funds within a short time span. Mutual funds are clamping down on the activity of employees enrolled in company retirement plans trading in a short time span, largely because of regulatory probes into rapid trading and late trading.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.