Understanding the Costs Involved in Mutual Fund Investments

Bob is debating purchasing a mutual fund, but he has some questions for his financial advisor, Cho. The following table presents information on four different open$-$end mutual funds that Bob and Cho are discussing. Use the information in the table to answer the questions that follow.

$\backslash$table$[[$FUND$,$NAV,NET CHG$,$YTD $\%$ RET$],[$MinT p$,12\mathrm{.}32,-0\mathrm{.}04,2\mathrm{.}6],[$TmRE r$,15\mathrm{.}77,0\mathrm{.}06,5\mathrm{.}5],[$PFIN$,39\mathrm{.}81,0\mathrm{.}20,8\mathrm{.}0],[$BRRT$,43\mathrm{.}21,0\mathrm{.}29,9\mathrm{.}1]]$

BOB: After some research, I've narrowed it down to these four funds, but can you explain to me the relationship between $12b-1$ fees and fund performance?

CHO: Generally, funds that charge $12b-1$ fees, such as MinT p$,$ do not necessarily grad outperform funds that do not charge these fees.

BOB: What about front$-$end load fees? For example, suppose BRRT has a front$-$end load fee of $6\%,$ when do I pay this fee?

CHO: If you purchase $100$ shares of this fund at the NAV, you will pay a commission of $,$ but when you sell these shares you will pay in front$-$end fees.

BOB: It sounds like these fees could start to add up$.$ What's the most I can expect to pay in fees?

CHO: If a fund charges a $4\%$ front$-$end load and a $4\%12-$ b $1$ fee, then it can charge a maximum of only $\%$ in back$-$end load charges without violating the cap.

BOB: Thanks! This was really helpful. So it sounds like you'd recommend looking for funds whenever possible.