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Explain how high watermark provisions help protect investors in a hedge fund against hedge fund managers underperformance. 1. Explain the relationship (asymmetric) between performance (indirect)
Explain how high watermark provisions help protect investors in a hedge fund against hedge fund managers underperformance.
1. Explain the relationship (asymmetric) between performance (indirect) and compensation (based only on MERs management expense ratio).
2. Explain how compensation should be linked with performance for alternative investments.
3. Explain what is high watermark and how the compensation structured works
4. Explain how it protects the investors.
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