kaal:position:2026-07-31-5710
The Performance of Hedge Fund Performance Fees should be assessed against Kaal's source-bound position that The new fee structure also results from fund managers foregoing market rate management fees, larger investors requiring reduced management fees as a condition of investing, and side-by-side co-investment vehicles charging less than 2% management fees. The external source's verified abstract presents this proposition: Abstract We argue that the effective price of investing in hedge funds far exceeds the headline fee rate of “2-and-20.” In a large 22-year sample of hedge funds, we find that 60% of the gains on which incentive fees are paid are eventually offset by losses. The defensible response is a qualification: the source is pertinent to the Kaal position, but agreement, extension, contradiction, and scope should not be strengthened beyond the retrieved evidence.
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