Worked Example
An example might be as follows: An investor subscribes for shares worth $1,000,000 in a hedge fund. Over the next year the NAV of the fund increases by 10%, making the investor's shares worth $1,100,000. Of the $100,000 increase, 20% (i.e. $20,000) will be paid to the investment manager, thereby reducing the NAV of the fund by that amount and leaving the investor with shares worth $1,080,000, giving a return of 8% before deduction of any other fees.
Read more about this topic: Performance Fee
Famous quotes containing the word worked:
“I think it’s unfair for people to try to make successful blacks feel guilty for not feeling guilty.... We’re unique in that we’re not supposed to enjoy the things we’ve worked so hard for.”
—Patricia Grayson, African American administrator. As quoted in Time magazine, p. 59 (March 13, 1989)
“I do not want to be covetous, but I think I speak the minds of many a wife and mother when I say I would willingly work as hard as possible all day and all night, if I might be sure of a small profit, but have worked hard for twenty-five years and have never known what it was to receive a financial compensation and to have what was really my own.”
—Emma Watrous, U.S. inventor. As quoted in Feminine Ingenuity, ch. 8, by Anne L. MacDonald (1992)