Ch14 Article 3 - Pressure to reduce '2 and 20' hedge fund...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Page 1 of 2 2009 Factiva, Inc. All rights reserved. Pressure to reduce '2 and 20' hedge fund fees By Sam Jones and Kate Burgess 07973 734 757 795 words 2 August 2009 Financial Times (FT.Com) FTCOM English (c) 2009 The Financial Times Limited. All rights reserved The halcyon days when hedge funds' "2 and 20" fee structure went unchallenged may be over. The debate over the amount hedge funds charge their clients - famously a 2 per cent cut on assets under management and a 20 per cent cut on returns - is a perennial controversy. But with hedge funds still flattened by the financial crisis, and huge inflows of new money into alternative strategies anticipated in coming months, pension funds and other large institutional investors find themselves in a position to negotiate lower fees. As a survey by Prequin, the investment consultancy, found last week, the average hedge fund is now charging on average 1.63 per cent in annual management fees and 17.2 per cent in performance fees. "It is clear that the '2 and 20' structure as the industry standard is becoming outdated," says Amy Bensted, Preqin's manager of hedge fund products.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 2

Ch14 Article 3 - Pressure to reduce '2 and 20' hedge fund...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online