Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A hedge fund with $2.5 billion of assets charges a management fee of 2% and an incentive fee of 20% of returns over a money

A hedge fund with $2.5 billion of assets charges a management fee of 2% and an incentive fee of 20% of returns over a money market rate, which currently is 4%. Calculate total fees, both in dollars and as a percent of assets under management, for portfolio returns of: (Enter your answers in millions rounded to 1 decimal place.)

Portfolio Rate of Return (%) Total Fee ($ million) Total Fee (%)
a. 5
b. 0
c. 4
d. 8

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Take The Trade A Floor Trade

Authors: Tony Wilson

1st Edition

979-8218195458

More Books

Students also viewed these Finance questions