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:
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And arrogant eternity.”
—Philip Larkin (1922–1986)
“These last worked only one hour, and you have made them equal to us who have borne the burden of the day and the scorching heat.”
—Bible: New Testament, Matthew 20:12.