A move by HBK focuses attention on other big name funds
It started as a seemingly benign request by Dallas-based HBK Investments to pass a number of expenses - such as telephone charges, research and bills for outside services - on to investors in addition to the 1.5% management fee. HBK told investors that these expenses wouldn't total more than 30 basis points and said that it was vital to keeping the firm competitive.
Investors bought the story and approved the change at a shareholder meeting in November. However, the HBK move has focused attention on the thorny subject of passing on expenses to investors. Many investors are now concerned that it is becoming a major trend - a very dangerous trend that will end the alignment of interests between managers and investors that has existed in the industry ever since the days of A.W. Jones.
Over the years, the industry fee...