Brevan Howard Asset Management Cuts Management Fees

Sep 26 2016 | 10:37pm ET

Macro hedge fund Brevan Howard, one of Europe’s largest alternative investment managers, will reportedly lower the fees it charges on its flagship Master and Multi-Strategy funds.

Dissatisfaction with high fees has run high in recent years in the face of disappointing returns. Brevan’s main fund has posted two consecutive years of negative returns, and it was one of the macro vehicles hardest hit during the first half of the year, when The Wall Street Journal estimates it lost an estimated $3 billion in redemptions.

Management fees will be cut to zero for some current investors as December 1, according to a Reuters article citing a source close to the matter, although performance fees will remain at 20%. 

Brevan Howard joins a number of fellow hedge fund managers, including Caxton, Och-Ziff and Tudor, in lowering the costs shouldered by their investors. 

A recent study by Preqin revealed that despite a gradual shift lower in fees across the industry, more than half of investors polled cited fees as a key issue facing the industry over the next twelve months, and nearly sixty percent do not believe their interests are well aligned with those of their managers.

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