Former Millennium Management executive Bobby Jain is offering steep fee discounts to investors ahead of the launch of Jain Global, which is widely expected to be the largest hedge fund debut ever, in July this year, according to a report by Bloomberg.
The report cites unnamed sources with knowledge of the matter as revealing that investors who commit at least $250m this month will pay performance fees of just 10%, much lower than the previously discounted 18% offered by Jain last year.
The disputed fee structure has also been offered "in perpetuity" according to Bloomberg's sources, although capacity for this particular share class will be limited.
The fee structure is far below the traditional '2-and-20' industry standard which has given way to more 'flexible' fees as managers look to attract investors in an increasingly difficult fundraising environment.
Jain Global is also offering an annual redemption right for every investor which will come into effect after the 18 months that the firm will take to invest all of the capital it raises. Investors will then be able to get their cash back within a year although they will face a 3% increase in performance fees and a 5% redemption fee.
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