Two and twenty is long dead. Hedge fund fees fall further below onetime industry standard
In recent years, average fees charged by hedge funds have shrunk.
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$.36 out of every $1 earned returned to investor?When factoring variables such as exit decisions and losers in the cross section of funds, the researchers found that limited partners in hedge funds are actually giving far more in fees as a percentage of profit. For example, if capital is redeemed from a fund experiencing losses — but one that previously generated returns and collected incentive fees — the payout to general partners as a percentage of the gross profit would be lower, the study shows.
After subtracting management fees, the study concluded that limited partners were only taking home 36 cents for every dollar earned on their invested capital.