Singapore-based multi-strategy hedge fund firm Dymon Asia is creating a new share class, featuring a client-friendly fee-structure and including a so-called hurdle rate, as part of a $1bn fund-raising effort, according to a report by Bloomberg.
The move, which means investors in the new share class will not pay performance fees until returns for the year reach at least 5%, comes as capital inflows for the industry slow and higher interest rates enhance the appeal of cash.
The report quotes Dymon’s Founder and CEO, Danny Yong, as saying in an interview: “Basically, at below 5% we don’t deserve to get paid.”
The $4.3bn firm’s new hurdle rate share class, which is something of a rarity in the hedge fund world, will be available to all new investors joining the $1bn fundraising, as well as existing clients who wish to switch over to the fee structure, which will charge 15% when returns top 5%, rising to 25% after gains exceed 15%.
