CFA Practice Question

There are 139 practice questions for this study session.

CFA Practice Question

What are primary sources of returns for GPs?

I. Management fees.
II. Carried interests.
III. Trailer fees.
IV. Admin fees.
Correct Answer: I and II

Management fees can yield very large sum of money, especially when one considers that the funds are extremely lean organizations with few employees and even fewer partners who enjoy a share of the profits.

User Contributed Comments 2

User Comment
ankurwa10 Ah, saying that management fees are primary source of "returns" is stretching it. Simply because unless the fund size is huge, such small percentages (2% or lesser) - btw historical management fees have come down quite a bit to 2% or less; it would not make a world of difference in terms of returns.

Carries Interest or performance fees is the bread and butter of these firms, in terms of how they make money.
pranavnmbr thanks, ankurwa10
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