Caxton Cutting Fees

Oct 15 2012 | 8:33am ET

Caxton Associates, the $7.5 billion New York-based hedge fund, will lower the fees it charges clients.

The fund, which had been charging a 3% management fee and 30% performance fee, will cut those to 2.6% and 27.5%, reports the Wall Street Journal, citing people familiar with the firm.

That still puts the fund's fees above the industry standard 2% and 20%. Caxton has been able to charge  high fees because, since its inception in 1983, it has produced annualized returns of about 20%. Since 2008, however, the macro fund—like other macro funds—has produced more muted returns. Last year, the fund returned 0.7% and, in a letter described to the WSJ by investors, Caxton chairman and CEO Andrew Lane acknowledged the lower recent performance.

In deciding to cut fees, Caxton follows managers like Tudor Investment, which introduced a new share class for its flagship fund carrying fees of 2.75% and 27% (compared to 4% and 23%) and the $7.3 billion Graham Capital Management which is reportedly considering cutting fees for its Proprietary Matrix hedge fund.

Caxton was founded in 1983 by Bruce Kovner and Peter D'Angelo, both of whom retired last year.

In Depth

Related-Company Fees: Normal Industry Practice or Conflicted Compensation?

Nov 11 2015 | 4:23pm ET

Regulatory agencies as well as investors are increasingly exploring whether certain...


Ferrari Roars in Wall Street Debut

Oct 21 2015 | 4:28pm ET

Shares of supercar maker Ferrari jumped as much as 15 percent to a high of nearly...

Guest Contributor

Private Debt - What is the Opportunity?

Nov 11 2015 | 3:28pm ET

In this contributed article, Rob Allard, founding partner of Firebreak Capital...


Editor's Note

    Oct 21 2015 | 10:41am ET

    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…