Alternative Investment Performance Fee Arrangements and Implications for SEC Regulatory Policy
Volume: Volume 6, No. 1
Issue: Spring 1975
Pages: pp. 127-160
Authors: Franco Modigliani and Gerald A. Pogue
Title: Alternative Investment Performance Fee Arrangements and Implications for SEC Regulatory Policy
Abstract: This paper first examines the effect of two basic types of investment performance fees, which differ in the method of performance measurement, on the amount and variability of investment advisory compensation. Then this effect is related to the risk borne by fund investors. From this analysis, policy implications for the SEC's regulation of incentive fee plans are drawn, with considerations of equity, resource allocation, and minimization of restrictive rules.
JEL Classification
Capital Markets Empirical Studies, Including Regulation (3132)