Click here if you are using screen reading software for the visually impaired and want to log on to this site.

Quotes, News, Research

symbol name

Separate multiple symbols with a space

Mutual Funds

Revenue Sharing Fund Families

What Every Investor Should Know

Revenue Sharing

The information contained in this disclosure pertains to mutual fund purchases in traditional private client accounts. It does not apply to mutual fund purchases through Smith Barney's fee-based programs, including TRAK, TRAK NAV, Mutual Solutions, Integrated Investment Services, Portfolio Management Group, and Smith Barney Advisor.

From each fund family we offer, we seek to collect a mutual fund support fee, or what has come to be called a revenue-sharing payment. These revenue-sharing payments are in addition to the sales charges, annual distribution and service fees (referred to as"12b-1 fees"), applicable redemption fees and deferred sales charges, and other fees and expenses disclosed in the fund's prospectus fee table. Revenue-sharing payments are paid out of the investment adviser's or other fund affiliate's revenues or profits and not from the fund's assets. However, fund affiliate revenues or profits may in part be derived from fees earned for services provided to and paid for by the fund. No portion of these revenue-sharing payments to CGMI is made by means of brokerage commissions generated by the fund.

It is also important to note that our Financial Advisors receive absolutely no additional compensation as a result of these revenue-sharing payments.

In 2008, we are charging fund families revenue sharing fees up to a maximum per fund family of: (a) 0.09% per year ($9 per $10,000) on fixed income fund assets held by our clients, and (b) 0.12% per year ($12 per $10,000) on equity, balanced and offshore fund assets held by our clients, subject to a minimum charge of $50,000 per year per fund family, or $25,000 per year for fund families that offer five or fewer funds at Smith Barney. In addition, they will be subject to volume discounting (that is, as the number of assets increases, the basis point charge for those assets will decrease).

Set forth below is a listing of the fund families from which we received revenue-sharing payments in 2007. Fund families are listed based upon the total amount of revenue-sharing payments we recognized from each fund family for 2007.

Representatives of Fund Families are, subject to the discretion of Branch Office Managers, provided access to our branch offices and Financial Advisors for educational, marketing and other promotional efforts. Although all fund families are provided with such access, some fund families devote more staff and resources to these activities and therefore may have enhanced opportunities to promote their funds to our Financial Advisors. This fact could, in turn, lead our Financial Advisors to focus on those funds when recommending mutual fund investments to our clients instead of on funds from those fund families that do not commit similar resources to education, marketing and other promotional efforts. Fund families that do not remit revenue-sharing payments typically will not be provided such access and will not participate in or receive other corporate promotional support.

Revenue-Sharing Fund Families



Expense Reimbursements and Administrative Service Fees

We receive expense reimbursements and fees for recordkeeping and related services, which are more fully described below. These reimbursements and recordkeeping fees may be viewed as a form of revenue sharing but are not included in the data provided above. We may be reimbursed by funds or their affiliates or other service providers for the expenses we incur for various sales meetings, seminars, and conferences held in the normal course of business. Although fund companies independently decide what they will spend on these activities, we are aware that some fund companies allocate their promotional budgets based upon prior sales and asset levels and that they work with our branch offices or Financial Advisors to plan promotional and educational activities on the basis of such budgets. We do not control fund companies' determinations of how to allocate their promotional budgets or their spending decisions in this regard.

We receive compensation from funds or their affiliated service providers for providing certain recordkeeping and related services to the funds. These charges typically are based upon the number or aggregate value of client positions and the levels of service provided. We trade with certain fund families on an omnibus basis, which means we consolidate our clients' trades into one daily trade in our name with the fund, and therefore we maintain all pertinent individual shareholder information for the fund. Trading in this manner requires that we maintain the transaction history necessary to track and process sales charges, annual service fees, and applicable redemption fees and deferred sales charges for each position, as well as other transaction details required for ongoing position maintenance purposes. We charge those funds administrative service fees of up to $21 per year per client position. Because omnibus trading offers economies for us and the funds that are greatest when daily trade volumes are high, we have sought to establish omnibus trading arrangements with the fund families that our clients trade the most.

As of March 2008, we were trading on an omnibus basis with: AIM, Alliance, American, AxaEnterprise, Arrow, BlackRock, Calamos, Columbia/Liberty/Nations, Cohen & Steers, Cullen Funds, Davis, Delaware, Dreyfus, Eaton Vance, Evergreen, Federated, Fidelity, First Eagle, Franklin Templeton, Gabelli, Goldman Sachs, Hartford, ING, IVY, IXIS (CDC NVEST), John Hancock, JP Morgan/One Group, Keeley, Legg Mason, Lord Abbett, Mainstay, MFS, Morgan Stanley, Munder, Nuveen, Olstein, Oppenheimer, Phoenix, PIMCO, Pioneer, Prudential/Strategic Partners/American Skandia, Putnam, RiverSource, Scudder/DWS, Seligman, Sun America, Thornburg, Transamerica/IDEX and Van Kampen.

For More Information

For additional information on a particular fund's payment and compensation practices, please refer to the fund's Prospectus and Statement of Additional Information. For further information regarding the fund fees and expenses borne by you and how Smith Barney and your Financial Advisor are compensated when you purchase and hold mutual fund shares, please refer to "Mutual Fund Share Classes and Smith Barney Compensation" (available at the hyperlink above), call toll-free 1-800-520-7740, or call your Financial Advisor.


♦ About Us ♦ Institutional Services

 

A Member of Citigroup

Privacy, Security, Terms and conditions

© 2008 Citigroup Global Markets Inc. All rights reserved. Member SIPC.