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Basic Question 4 of 15

Assume a "2 and 20" compensation structure with 8% hurdle rate and a catch-up clause. If the partnership is 6% this year,

I. LPs can require a clawback from GP.
II. LPs gets the entire 6%.
III. The management fee is always paid by the investor, regardless of profits.
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User Contributed Comments 1

User Comment
923029 Is that a net 6% after the management fee of 2% AUM is deducted? 8% - 2%?
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Lina

Lina

Learning Outcome Statements

describe investment ownership and compensation structures commonly used in alternative investments

CFA® 2024 Level I Curriculum, Volume 5, Module 1.