My hedge fund has this practice, is it normal?
I just joined a hedge fund and we have this investment challenge game within our team. The game is to play a virtual investment game with hypothetical money. But the payoff, which is determined by our over/under-performance against a particular index (say MSCI APAC ex Japan), instead of the actual returns of our holdings, is real. So for example if my virtual holdings for the month returned 5% while the index returned 3%, I would receive 2% x USD 100 = USD 200 from my boss. I am just wondering if this is a normal or legitimate practice within a fund house. My boss said he got the idea from a retiredwho used to do this with his team. Thank you.