Question

A hedge fund with $1.5 billion of assets charges a management fee of 2% and an...

A hedge fund with $1.5 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 6%. 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. 6
d. 18
Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

EXCEL FORMULA:

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Sy fund has the following fee structure: 1% management fee based on beginning balance of assets...
Sy fund has the following fee structure: 1% management fee based on beginning balance of assets under management for the year 10% incentive fee with a 5% hard hurdle rate calculated on gains net of management fees using a high‐water mark The hedge fund started the year with a beginning balance of $2 billion, which is the highest value the fund has ever accumulated. The ending values before fees are $1.8 billion and $2.1 billion for years 1 and 2,...
A hedge fund with a 2% management fee also charges a 30% incentive fee on amounts...
A hedge fund with a 2% management fee also charges a 30% incentive fee on amounts over a net‐of‐fees high‐water mark. The following table shows the initial investment and year‐end value received, based on the performance. Year Beginning Ending 1 $1,000 million $1,200 million 2 $1,200 million $900 million 3 $900 million $1,150 million 4 $1,150 million $1,400 million 5 $1,400 million $1,500 million Based on the preceding data, in which of the following years will the general partner most...
A hedge fund has AUM of $ 100 million at the beginning of the year and...
A hedge fund has AUM of $ 100 million at the beginning of the year and earns a 20% return for the year. The fun charges a 2 % management fee on end of year portfolio value and a 15% incentive fee on the return , net of the management fees , that is in excess of a 6 % fixed hurdle rate. what is the total fee charged by the fund manager? plz be specici write the fomulas also...
At the start of the year, the value of assets managed by the QQ Hedge Fund...
At the start of the year, the value of assets managed by the QQ Hedge Fund was $100 million. Over the year, the fund earned a gross return of 15% compared with the market index return of 9%. The fund manager charges a management fee of 1.5% of the asset value at commencement, and a performance fee of 20% above the market benchmark. Calculate the following information: The management fee is $__________ million. Excess dollar return above the market is...
Mary bought a hedge fund which charges "2 plus 25%" last year. Let the fund currently...
Mary bought a hedge fund which charges "2 plus 25%" last year. Let the fund currently earn 35% before fees. Mary redeems her fund units now, what is the total fee (in %) paid by her?   how much does she earn (in %) after fees?
4.A PE firm with a $10 billion fund charges a 2 percent management fee annually, and...
4.A PE firm with a $10 billion fund charges a 2 percent management fee annually, and 20 percent carried interest on profits. In year 5, the company is acquired at 2x its investments. What is the investment multiple and IRR for the LPs?
1. A sector fund specializing in commercial bank stocks had average daily assets of $3.7 billion...
1. A sector fund specializing in commercial bank stocks had average daily assets of $3.7 billion during the year. Suppose the annual operating expense ratio for the mutual fund is .85 percent, and the management fee is .50 percent. How much money did the fund’s management earn during the year? If the fund doesn’t charge any 12b-1 fees, how much were miscellaneous and administrative expenses during the year? (Do not round intermediate calculations. Enter your answer in dollars not in...
Consider a mutual fund with $207 million in assets at the start of the year and...
Consider a mutual fund with $207 million in assets at the start of the year and with 10 million shares outstanding. The fund invests in a portfolio of stocks that provides dividend income at the end of the year of $4 million. The stocks included in the fund's portfolio increase in price by 8%, but no securities are sold, and there are no capital gains distributions. The fund charges 12b-1 fees of 1.00%, which are deducted from portfolio assets at...
a mutual fund has $375 million in assets at the start of the year and 12...
a mutual fund has $375 million in assets at the start of the year and 12 million shares outstanding. the fund invests in a portfolio of stocks that provides dividend income at the end of the year of $5 million. the stocks included in the fund’s portfolio increase in price by 9%, but no securities are sold and there are no capital gains distributions. the fund charges 12b-1 fees of 1.5% which are deducted from portfolio assets at year end....
A hedge fund with net asset value of $61 per share currently has a high water...
A hedge fund with net asset value of $61 per share currently has a high water mark of $67. Suppose it is January 1, the standard deviation of the fund’s annual returns is 31%, and the risk-free rate is 3%. The fund has an incentive fee of 10%. a. What is the value of the annual incentive fee according to the Black-Scholes formula? (Treat the risk-free rate as a continuously compounded value to maintain consistency with the Black-Scholes formula.) (Do...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT