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Do we know if the customers definitely pay the fees in full? One might imagine a large customer (like a pension fund) might be able to negotiate a discount, and
by conistonwater 10y ago
Do we know if the customers definitely pay the fees in full? One might imagine a large customer (like a pension fund) might be able to negotiate a discount, and the discount might not show up in the published returns, or something like that?
- lordnacho 10y agohttp://www.zerohedge.com/news/2016-12-22/traditional-2-20-fee-structure-taking-hit-hedge-funds-continue-underperform http://www.zerohedge.com/news/2016-12-22/traditional-2-20-fe... It's unusual to pay the sticker price.
- h1srf 10y agoSmall to mid-size funds may not be able to get away with charging 2-20 but larger, more established funds still can regardless of size. Tudor was charging 4-23 on one of its funds. Not sure if that's still the case since they were down a bunch this past year.
- soVeryTired 10y agoFees are coming way down in the industry - very few shops can charge 2 and 20 these days. A flat fee of 1% is much more likely. Bill Ackman was a rockstar od the industry, so could get away with it for longer than most. Not any more. Even in the old days, 2 and 20 was the starting point for a negotiation. If a client can bump up a firm's assets under management significantly, they have a lot of bargaining power.
- zpr 10y agoUsually bigger clients negotiate their own fee structures.