Calculating Costs

Tue Jun 1, 2004


Getting the spend right


For a sound venture, it's vital that hedge fund managers put together a realistic business plan to make sure their costs don't outstrip their fee income, writes Barry Cohen

Starting your own fund is an often challenging, difficult and expensive process, particularly as many start-up managers have never had to carry the burden of running their own business. More likely, they have frequently worked in an environment where everything, from marketing the fund to ensuring that the office has sufficient supplies of paper clips and coffee, was handled by a fully staffed infrastructure.

From the outset, it is crucial that aspiring hedge fund managers construct a realistic business plan or else their dreams may prove to be short-lived. If the numbers don't make good economic sense, start-up managers will soon learn that their costs are outstripping their fee income, putting the entire venture at risk. Frequently, start-up managers are overly...

ISSN: 2151-1845 / CDC10004H

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