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The Optimal Size of Hedge Funds: Conflict between Investors and Fund Managers
This study examines whether the standard compensation contract in the hedge fund industry aligns managers’ incentives with investors’ interests. I show empirically that managers’ compensation increases when fund assets grow, even when diseconomies of scale in fund performance exist. Thus, managers’ compensation is maximized at a much larger fund size than is optimal for fund performance. However, to avoid capital outflows, managers are also motivated to restrict fund growth to maintain style-average performance. Similarly, fund management firms have incentives to collect more capital for all funds under management, including their flagship funds, even at the expense of fund performance.
Ketersediaan
| Call Number | Location | Available |
|---|---|---|
| The Journal of Finance | PSB lt.dasar - Pascasarjana | 1 |
| Penerbit | : 2016 |
|---|---|
| Edisi | Vol. 71, Number 4, Aug. 2016 |
| Subjek | Financial intermediation Hedge funds investor-manager conflict incentive alignment |
| ISBN/ISSN | 00221082 |
| Klasifikasi | NONE |
| Deskripsi Fisik | p. 1857-1894 |
| Info Detail Spesifik | The Journal of Finance |
| Other Version/Related | Tidak tersedia versi lain |
| Lampiran Berkas | Tidak Ada Data |