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Finra Series-6 Exam - Topic 3 Question 106 Discussion

Which of the following statements regarding a mutual fund's expenses are true?
B) A mutual fund's record maintenance fees cannot exceed 0.25% of average net assets.
A) A mutual fund that has a front-end load cannot also charge 12b-1 fees.
C) The expense ratio of a mutual fund cannot exceed 1.0%.
D) A mutual fund family is prohibited from charging a fee when an investor exchanges his shares of one of its funds for another.

Finra Series-6 Exam - Topic 3 Question 106 Discussion

Actual exam question for Finra's Series-6 exam
Question #: 106
Topic #: 3
[All Series-6 Questions]

Which of the following statements regarding a mutual fund's expenses are true?

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Suggested Answer: B

The true statement regarding a mutual fund's expenses is that a mutual fund's record maintenance fees cannot exceed 0.25% of average net assets. Mutual funds are permitted to have both front-end loads and charge 12b-1 fees, and the expense ratio of a mutual fund can exceed 1.0% (although a common recommendation is to select a fund with an expense ratio 1.0%.) Mutual fund families have the option of charging an ''exchange fee'' when an investor switches between their funds.


by Tawanna at Aug 17, 2025, 09:47 AM

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Blair
6 months ago
Not sure about that last one, I think they can charge fees for exchanges.
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Milly
6 months ago
Record maintenance fees are capped at 0.25%, that's a fact.
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Dorothea
7 months ago
Wait, are you serious? I thought there were limits on those fees!
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Beata
7 months ago
Totally agree, the expense ratio can definitely exceed 1%.
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Bette
8 months ago
A mutual fund can have both front-end loads and 12b-1 fees.
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Yong
8 months ago
I think mutual fund families can charge fees for exchanges, but I might be mixing that up with something else.
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Margarita
8 months ago
I feel like I saw a question about expense ratios in practice, but I can't recall if 1.0% is a hard limit or just a guideline.
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Deonna
8 months ago
I’m not sure about the record maintenance fees; I thought they could vary, but 0.25% sounds familiar.
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Jeff
9 months ago
I remember studying that front-end loads and 12b-1 fees can coexist, so I think A is false.
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Reena
9 months ago
The expense ratio limit is something I'm familiar with, but the other details about record maintenance fees and exchange fees are a bit fuzzy. I'll need to think through those carefully.
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Elise
9 months ago
Okay, I think I've got a good handle on this. I'll start by considering each statement individually and see which ones I can confidently identify as true or false.
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Maryln
9 months ago
Hmm, I'm not entirely sure about the rules around front-end loads and 12b-1 fees. I'll need to review that part carefully.
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Dortha
9 months ago
This question seems straightforward, but I want to make sure I understand the details about mutual fund expenses before selecting an answer.
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Rebbeca
10 months ago
D is the answer for sure. Mutual fund families love to charge those pesky 'exchange fees' whenever you move your money around. It's highway robbery if you ask me!
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Dean
10 months ago
C can't be right, I've seen mutual funds with much higher expense ratios than that. 1% seems way too low.
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Robt
6 months ago
Right? It’s crazy how high some fees can get.
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Curtis
7 months ago
True, some funds go over 2% easily.
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Nan
7 months ago
I agree, 1% is often just the starting point.
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Anika
7 months ago
Definitely! Always check the expense ratio before investing.
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Marya
11 months ago
I believe statement C is also true because most mutual funds aim to keep their expense ratio below 1.0% to attract investors.
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Yen
11 months ago
I agree with you, Marge. Statement A seems logical to me.
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Freida
11 months ago
I think the correct answer is B. The 0.25% limit on record maintenance fees sounds about right to me.
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Pura
10 months ago
I agree, option B seems correct. The 0.25% limit makes sense.
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Marge
11 months ago
I think statement A is true because front-end load and 12b-1 fees are different types of fees.
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