Funds have long tied fund manager compensation not to performance but to assets under management. But that is changing, as more companies waive fees for under-performing funds and link fees to gains. Charles Schwab last month boosted the number of funds that would refund the previous quarter's management fee to dissatisfied investors to 16. In February, Fidelity embraced a performance-based fee for 19 more additional funds, brining the total to 68 (if shareholders approve). Eight of Dunham & Associates' 11 funds are performance-linked. The expense ratio might rise if the fund outperformed its benchmark by a set amount. On the other hand, under-performance will lead to waived fees. Is all this lost on buyers? Maybe not. In a down market, fee waivers are appreciated.

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- here's the AP article
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