A global survey of early-stage investors focused on hedge funds shows that the majority of those based in the Asia-Pacific demand a significant discount on performance fees charged by start-up hedge fund managers.
Hedge fund managers typically set a 20% performance incentive fee but the survey revealed that APAC investors demand on average discount of 611 basis points for allocating to funds at the early stage of a fund’s life cycle.
The Citi Prime Finance survey showed that 78% of Asia-based respondents expect discounts ranging between 500 to 1000 bps.
Investors in the US, however, appear to be even...