Fri, Sep 4, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Preqin reveals hedge funds with highest fees achieve best net returns

Friday, August 30, 2013

amb
Amy Bensted
Beverly Chandler, Opalesque London:

Hedge funds with highest performance fees deliver best net returns reveals new research from Preqin. The firm found that hedge funds that charge performance fees of more than 20% have produced the highest net returns in four out of the past six years. Preqin’s data shows hedge funds with at least a three- year track record that have posted positive returns each month since inception charge an average performance fee of 19.50%.

Funds with positive performance in less than a quarter of the months studied charged an average performance fee of 16.67%.

Other key facts from the study include:

  • Funds with the highest fees show the best long-term net absolute returns for their investors
  • Hedge funds which charge higher performance fees have produced the highest net returns for investors on a three- and five-year annualized basis.
  • Funds with fees over 20% have also produced the strongest risk adjusted net returns – with a Sharpe-ratio (2%) of 2.11 over a three-year period (compared to 1.18 of funds with a performance fee of 20%). Despite this investors are still seeking further alignment of interests and are continuing to negotiate fees
  • The proportion of investors that believe fund manager and investor interests are properly aligned at present has fallen to 64%, compared to 74% in 2012.
  • Management and performance fees are mos......................

    To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: New Detroit-based CTA seeks to take advantage of coming volatility[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: An emerging manager has just set up his one-man shop in the city of Detroit. Synchronicity Futures,

  2. Cliff Asness attracts $360 million as liquid alternative funds hold up[more]

    From Bloomberg.com: As U.S. stocks suffered their worst month in more than three years in August, Clifford Asness’s managed futures fund was able to profit. Investors are taking notice. The $9.12 billion AQR Managed Futures Strategy Fund pulled in an estimated $360 million in net subscriptions last

  3. Opalesque Exclusive: When the SEC calls, fund managers need to get out of their own way[more]

    Bailey McCann, Opalesque New York: New pressure is hitting alternative investment funds from all angles. So far this month both hedge fund and private equity players have seen enforcement actions, and subsequent fines over fees, disclosures, and misleading statements. Citi one of the biggest

  4. Performance - Einhorn and Loeb's hedge funds both decline 5% in August, Some target-date funds miss in the market turmoil[more]

    Einhorn and Loeb's hedge funds both decline 5% in August From Reuters.com: Hedge fund billionaires David Einhorn and Daniel Loeb saw their main funds lose roughly 5 percent in August during a dramatic market sell off, two people familiar with their returns said on Monday. Einhorn's

  5. Fortress hedge fund manager David Dredge says markets trouble on the way[more]

    From AFR.com: David Dredge of global hedge fund Fortress has built a career studying, predicting and protecting against the world's major financial crises. The recent convulsions in global sharemarkets are "just the beginning" of a painful adjustment as money drains from the emerging market economie

 

banner