Costs & Fees
Incentive Fee
Definition
What is Incentive Fee?
A fee based on investmentAn asset or commitment of money made with the expectation of future income, growth, or both. performance, often subject to additional conditions.
Example in practice
How This Looks in Practice
The hedge fundA privately offered pooled fund that may use leverage, short selling, derivatives, and flexible strategies. receives 20% of eligible gains.
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Related Terms
Costs & Fees
Management Fee
The recurring fee paid from fund assets to the fund manager for managing the portfolio.
Costs & FeesExpense Ratio
A fund's annual operating expenses expressed as a percentage of its average net assets.
Costs & FeesEntry Load
A charge deducted when an investor subscribes to a fund.
Plans & OptionsAccumulation Option
A fund option that retains or reinvests income so it contributes to unit-value growth.