How is deferred comp invested in hedge funds that use a pod structure?
Non finance person here, just interested in the mechanics of how hedge funds work.
So my understanding is that with a pod structure, the pod gets x% of the PNL as compensation and then the hedge fund itself charges perfomance fees on the remaining return before passing on the net return to the investor in the fund.
My question is, if a PM defers a portion of their pay how is that money invested?
Is it invested back into the pod's strategy and if so does the PM pay the same fees to the hedge fund that any other investor would have to pay?
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