Required: A hedge fund with $1.7 billion of assets charges a management fee of 2% and an incentive fee of 20% of returns over a money market rate, which currently is 5% Calculate total fees, both in dollars and as a percent of assets under management, for portfolio returns of (Enter your answers in millions rounded to 1 decimal place.) Answer is complete but not entirely correct. Total Fee (5 million) Portfolio Rate of Return (%) b.O C. 5 d. 10 34,000,000.0 34,000,000.0 34,000,000.0 51,000,000.0 Total Fee (%) 2.06 2.00 2.00 3.00

Required: A hedge fund with $1.7 billion of assets charges a management fee of 2% and an incentive fee of 20% of returns over a money market rate, which currently is 5% Calculate total fees, both in dollars and as a percent of assets under management, for portfolio returns of (Enter your answers in millions rounded to 1 decimal place.) Answer is complete but not entirely correct. Total Fee (5 million) Portfolio Rate of Return (%) b.O C. 5 d. 10 34,000,000.0 34,000,000.0 34,000,000.0 51,000,000.0 Total Fee (%) 2.06 2.00 2.00 3.00

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

1. You are evaluating investing in a private equity fund and estimate that it will yield the following cash flows: (see table) a. What is the expected IRR of the fund? You will need to use your financial calculator (or excel) to solve this problem. b. On average, private equity funds that invest in similar businesses earn a rate of return of 26%. Should vou invest in this fund (Hint: no calculations are needed)
D3) Finance You invest in a mutual fund that charges a 3% front-end load, 1% operating costs, and a 1% 12b-1 fees. What are the total fees in year 1 on an initial investment of $20,000 with 10% annual growth in fund's asset value, or NAV? Note that "initial investment" means it is before the deduction of frontend load.
There are two investment funds managed by the ABC investment company with the following characteristics: Fund Name Expected Return Standard Deviation Stock fund 20% 30% Bond fund 8% 10% The correlation of returns between the two funds is 0. The rate of 90-day Treasury bill is 2%. Suppose that you work in the ABC investment company as an investment advisor and provide one of its large private clients with advice on an investment decision. Specifically, this client has $1 million dollars for investments and is looking for the best investment combination of the stock fund, the bond fund, and the Treasury bill in terms of risk-return trade-off measured by Sharpe ratio.（need full process) Suppose that the client wants to have an expected return of 10% on the client’s complete investment portfolio that is the best investment combination of the stock fund, the bond fund, and the Treasury bill in terms of Sharpe ratio. For the total amount of money of $1…
A hedge fund with a 1 and 15 fee structure has a hard hurdle rate of 7.45%. If the incentive fee and management fee are calculated independently and the management fee is based on beginning-of-period asset values, an investor’s net return over a period during which the grows value of the fund has increase 19.45% is closest to A. 10.85%. B. 12.65%. C. 16.65%. D. 21.74%.
on this repurchase agreement. (a) You are investing GHS100,000 in an investment portfolio made up of a risky ass and a T/Bill. The expected return of the risky asset is 11% and its standard deviation is 20% The rate of return of the T/Bill is 3% (a) Compute what percentages of your funds must be invested in the risky asset and the risk-free asset so that the expected return of your investment portfolio is 8% (b) Compute what percentages of your funds must be invested in the risk-free asset and the risky asset to form a portfolio with a standard deviation of 8%.
A no-load fund charges a 12b-1 fee of 1% and maintains an expense ratio of 0.8%. Assumes the securities in which the fund invests increase in value by 6.54% per year. If you invested $1,000, how much will your fund shares be worth after 5 years? a. $1260.56 b. $1263.57 c. $1195.33 d. $1300.53
A hedge fund with $25 million of assets under management has a standard 2/20 fee structure and earns 14 percent this year. Assume that management fees are paid at the beginning of each year and performance fees are paid at the end of each year. Assume that the fund’s fee structure also contains a high-water mark provision. What is the management fee collected by the fund managers? What is the performance fee collected by the fund managers? What is the investor’s net return?
Consider the following information for the Alachua Retirement Fund, with a total investment of $4 million. The market required rate of returnis 12%, and the risk-free rate is 6%. What is its required rate of return? Stock Investment Beta A $500,000 1.2 B 500,000 -0.4 C 1,000,000 1.5 D 2,000,000 0.8 Total 4,000,000 Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Required: A hedge fund with $0.7 billion of assets charges a management fee of 3% and an incentive fee of 20% of returns over a money market rate, which currently is 6%. Calculate total fees, both in dollars and as a percent of assets under management, for portfolio returns of: (Enter your answers in millions rounded to 1 decimal place.) Required: A hedge fund with $0.7 billion of assets charges a management fee of 3% and an incentive fee of 20% of retums over a money market rate, which currently is 6%. Calculate total fees, both in dollars and as a percent of assets under management, for portfolio returns of: (Enter your answers in millions rounded to 1 decimal place.) Required: A hedge fund with $0.7 billion of assets charges a management fee of 3% and an incentive fee of 20% of returns over a money market rate, which currently is 6%. Calculate total fees, both in dollars and as a percent of assets under management, for portfolio returns of: (Enter your answers in millions rounded to…
Suppose at the start of the year, a no-load mutual fund has a net value of RM27.15 per share. During the year, it pays its shareholders a capital gain and dividend distribution of RM1.12 per share and finishes the year with NAV of RM30.34. Required: a. b. If at the end of the year, the fund is selling is selling at 5% discount, what is the rate of return? C. What is the return to an investor who holds 2000 shares of this fund in his retirement account? d. Differentiate between open end and closed end funds. Assume at the end of year, the company change its policy and charge. 12b-1 fees of 2%, What is the rate of return?
Mr. Aiman, Treasurer of AJ Finance Berhad, has just completed a Maturity Bucket Analysis based on the a 6-month horizon. a) If the market expectation is increase in interest rates, find the maturity bucket should Mr. Aiman, worries most about. Explain why the particular bucket matters. b) Outline an appropriate hedge strategy for Mr. Aiman,.
For the following levered total cash flow returns, what is the levered NPV, and should you pursue the investment if your levered discount rate is 14%? Year Total Cash Flow (Pre-Tax) $ 31,795; yes 31,795; no x-31,795; yes -31,795; no 0 (400,000) $ 1 30,000 $ 2 30,900 $ 3 4 31,827 $ 32,782 $ 5 533,765

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