General
two and twenty
What does two and twenty mean?
Hedge fund and PE compensation standard. Two percent of assets under management every year regardless of performance, plus twenty percent of any profits above the high-water mark. Made a generation of managers rich; clients have been negotiating it down for a decade.
"Nobody pays two and twenty anymore unless you're Citadel or Millennium."
Frequently asked questions
What does two and twenty mean?
It's the classic hedge fund fee structure: 2% of assets plus 20% of profits.
How does the two and twenty fee work?
The manager charges 2% of the total assets managed each year, plus 20% of any profits generated.
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