Only if the annual returns exceed 10% do we become eligible for a performance fee which will be calculated as follows:
  • In case the portfolio return achieved at the end of the year is above 10% p.a., a Performance Fee would be applicable at 25% on the incremental returns above 10%.
  • That is, to earn an industry standard 2% fund management fee, we first need to deliver about 18% in gross returns through performance each year.
  • In case the performance of the portfolio is below the hurdle rate of 10% in any year, the Portfolio Manager would have to make up for this hurdle rate and the subsequent year’s hurdle rate (i.e. 10% for year one and another 10% for year two..) before the performance fee would be applicable.
  • Client will be billed once at the end of financial year. GST and other taxes will be applicable as per the respective rates.