I am not sure whether the Hurdle needs to be applied over the AUM at beginning or the High watermark. As in the attached question from a test i can see Hurdle is charged on High watermark of $720 million ...
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If in question it is not mentioned that we need to take incentive fee as a hard or soft hurdle..m so in that case, which we need to take for the reference
KeshavAg
Asked: In: 8.1 CFA Level 1
A hedge fund started with an initial investment of 75 million. The end-of-year value after fees for Year 1 was 70 million. For Year 2, the end-of-year value before fees is 90 million. The fund has a 2 and 20 ...







