Hedge Funds
In a hedge fund, the management fee is calculated as a percentage of the fund's net asset value (the total of the investors' capital accounts) at the time when the fee becomes payable. Management fees typically range from 1% to 4% per annum, with 2% being the standard figure. Therefore, if a fund has $1 billion of assets at year-end and charges a 2% management fee, the management fee will be $20 million. Management fees are usually expressed as an annual percentage but both calculated and paid monthly (or sometimes quarterly or weekly) at annualized rates.
Read more about this topic: Management Fee
Famous quotes containing the word hedge:
“There’s such divinity doth hedge a king
That treason can but peep to what it would,
Acts little of his will.”
—William Shakespeare (1564–1616)