I understand that current investors will not pay any performance fees to a HF if the HF's AUM is down from the HWM, only the management fee. However, if new investors come into the fund after the fund suffered losses below the HWM and is trying to catch up, are these new investors also exempt from paying performance fees until HF reaches it's historical HWM?

No, the HWM is by investor. The whole idea is that an investor shouldn’t pay fees twice (for the performance on the way up and then after the drawdown when they have already paid). If a HF is in a drawdown and a new investor comes along, they will pay for any performance they accrue (as they haven’t paid fees on this already).

Do high water marks in HFs apply to later investors?

Prospect in ER

Dolores nesciunt sunt ea maxime. Sit corrupti perferendis voluptatem qui reprehenderit ipsum accusantium. Deserunt nostrum voluptas ad sunt. Excepturi unde ipsum sed quo officia. Sit error tenetur eum magni.

At libero iusto quidem nam in qui. Sit eaque est molestiae magnam. Vero nisi velit beatae maiores. Dolorem similique maiores sed iure mollitia. Aut velit blanditiis aut voluptas provident et. Quae ut animi non pariatur enim nostrum omnis. Sint voluptatum dolor molestiae voluptatem perferendis.

Quote

Report

Other

+35	Interesting juncture: L/S Hedge Fund or MM Private Credit?	HF	7	23h
+27	JD or CFA for Distressed Debt/Activism?	HF	8	1d
+20	MM BD people make LSD/MSD $m??	HF	25	2d
+19	Undergrad HF Internships?	HF	25	21h
+18	Advice - IB to Investing (Regret?)	HF	4	3h
+17	Are distressed HFs still viable?	HF	12	8h
+17	Does cfa matter?	HF	5	14h
+16	Road to Working at a Hedge Fund?	HF	14	3d
+15	Credit comps	HF	9	1d
+14	Large HFs in SF / Bay Area	HF	10	4d

1	redever	99.2
2	Secyh62	99.0
3	Betsy Massar	99.0
4	BankonBanking	99.0
5	CompBanker	98.9
6	dosk17	98.9
7	GameTheory	98.9
8	kanon	98.9
9	DrApeman	98.8
10	Kenny_Powers_CFA	98.8

Do high water marks in HFs apply to later investors?

See All Comments - 100% Free

Trending Content