Question
25. A hedge fund charges an incentive fee of 5% of any investment returns above the T-bill rate, which currently is 3.0% but is subject
25. A hedge fund charges an incentive fee of 5% of any investment returns above the T-bill rate, which currently is 3.0% but is subject to a high water mark. In the first year, the fund suffers a loss of 6.0%. What rate of return must it earn in the second year to be eligible for an incentive fee?(Do not round intermediate calculations. Round your answer to 2 decimal places.)
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Get StartedRecommended Textbook for
Multinational financial management
Authors: Alan c. Shapiro
10th edition
9781118801161, 1118572386, 1118801164, 978-1118572382
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