CNBC Cites Eller Finance Research

June 30, 2021

In the Headlines

Hedge fund research conducted by Andrea Rossi, assistant professor of finance in the Eller College of Management, was cited in a June 28 CNBC web article.

The article explains that the earliest-known hedge fund developed by A.W. Jones, charged investors a 20 percent fee from realized gains.

Over the years, hedge fund fees have shrunk—in the fourth quarter of 2020, hedge funds charged an average 1.4 percent management fee and 16.4 percent performance fee, which is down from the 1.6 percent management fee and 19 percent performance fee that was average a decade prior.

Rossi’s research however, takes a look at what is called the “effective incentive fee” which he and his co-authors say is closer to 50 percent, not the supposed 20 percent that is advertised.

Rossi joined the Eller College of Management in 2018 after earning his PhD in Finance from Ohio State University. A Chartered Financial Analyst, his areas of expertise include private equity, asset management, investor behavior and corporate insiders. He has also worked as a financial analyst for PFC and as a junior project manager for BNP Paribas.