Hey, You Have a Problem Paying Alpha Fees and Getting Beta Returns?
| Jul 4th, 2006 | Filed under: Investment Management Fees | By: Alpha Male |
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By: Jenny Anderson, New York Times
Published: May 26, 2006
Excerpt:
“The megamanagers of hedge funds deem themselves smarter than “index huggers” — mutual fund managers who must beat only a benchmark, whether that benchmark is up 20 percent or down the same amount.
“Many institutions are willing to pay the higher fees — typically 2 percent of assets under management and 20 percent of the profits — for a hedge fund’s performance because it lowers the risk. When markets slide, their money won’t follow. Or will it?”
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