A typical hedge fund incentive bonus is usually equal to ________ of investment profits beyond a predetermined benchmark index.

Question

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A hedge fund incentive bonus is typically calculated as a percentage of investment profits above a certain benchmark index, known as the high-water mark. This ensures that the fund manager only earns a bonus if they are able to generate returns that exceed previous highs, and incentivizes them to continually strive for strong performance. The typical percentage for this bonus is around 20%, although it can vary depending on the specific fund and agreement between the manager and investors. Therefore, the best choice for this question is C) 20%.

A Typical Hedge Fund Incentive Bonus Is Usually Equal to ________