Thu, Oct 28, 2021
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Hedge funds ready to negotiate management fees rather than performance fees

Monday, September 23, 2019

Laxman Pai, Opalesque Asia:

Research into the attitude of hedge fund managers towards negotiating lower fees has found that they are more likely to negotiate management fees rather than performance fees.

About 38.8% of the hedge funds covered by the research were willing to negotiate their management fee, but just 11.3% would negotiate the performance fee, said a report by eVestment.

The new report new State of Institutional Fees Report: Hedge Funds, measured 180 recent hedge fund investments by 50 U.S. public pension plans.

The size of the investment made in a hedge fund also impacted the amount and type of fee discounts hedge fund managers were willing to negotiate, according to the report.

The report provides an overview of stated and negotiated fees from a sample of 180 recent hedge fund commitments made by 50 U.S. public pension plans tracked by eVestment Market Lens.

The report offers investors and fund managers a look at how fee negotiations tend to go so all parties can reach mutually beneficial outcomes without investors paying too much or fund managers leaving money on the table.

The most common management fees were 1% (for managed futures and funds of hedge funds), 1.5% (equity and multi-strategy funds) and 2% (fixed-income funds). Event-driven/distressed and macro funds charged 1.5% and 2% with the same frequency.

The most common agreed-upon performance fee among all direct hedge funds was the oft-referenced 20%; for funds of hedg......................

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. SPACs: Is the SPAC boom fizzling out?, SPAC merger mania: Companies that went public via blank-check merger in Q3, SPAC marketing heavily curtailed in House Democrats' draft bill[more]

    Is the SPAC boom fizzling out? From Crunch Base: SPACs may be fizzling out. Since February 2021, when the SPAC (special-purpose acquisition company) craze was booming, a market selloff has wiped out about $75 billion of the value of companies that went public using SPACs, according to

  2. Institutional Investors: Vanderbilt University endowment records 57.1% return for fiscal year, MIT endowment logs 55.5% return for latest fiscal year, AP1 re-tenders $720m emerging markets small-cap mandate, Harvard, world's wealthiest university, sees endowment soar to $53.2bn, San Francisco shifts passive equity mandate to active BlackRock ESG strategy[more]

    Vanderbilt University endowment records 57.1% return for fiscal year From PIonline.com: Vanderbilt University's endowment returned a net 57.1% in the fiscal year ended June 30, according to a financial report on the Nashville, Tenn.-based university. The report did not provide benchma

  3. New Launches: Massar Capital launches new global discretionary strategy, White Oak closes latest direct lending fund at $1.3bn, Aterian replicates speedy fundraise to collect $830m in nine weeks, Sofinnova holds $548m final close for Capital X, Multicoin Capital targets $250m for third crypto VC fund, Tobam launches French bitcoin and blockchain fund[more]

    Massar Capital launches new global discretionary strategy Massar Capital Management has launched a new discretionary macro hedge fund strategy which aims to capitalize on directional trading opportunities across a broad set of global markets. The Massar Macro Directional is the N

  4. How Viking Global became the hedge-fund industry's hottest launch pad[more]

    From Business Insider: Since Dan Sundheim's massively successful launch of D1 Capital in 2018, there have been six more spinoffs from Viking Global that have collectively raised billions - and at least one more is in the works. Among them: Grant Wonders, 31, who launched Voyager Global this ye

  5. PE/VC: Moody's warns of 'systemic risks' in private credit industry, Sequoia to restructure itself away from traditional VC model, Modeling private equity market beta, VC investors pour money into Chinese start-ups despite regulatory crackdown[more]

    Moody's warns of 'systemic risks' in private credit industry From FT: The burgeoning private credit industry of lending to buyout groups has grown to about $1tn, but opacity, eroding standards and the difficulty in trading these slices of debt pose "systemic risks", according to rating