incentive fee

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Incentive fee

Compensation paid to commodities trading advisers or to any practitioner who achieves above-average returns. Sometimes called performance fee.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Incentive Fee

A fee paid to an asset manager or other investment adviser whose investment decisions perform particularly well. When an asset manager makes money for clients, he/she also makes money for the company for which he/she works. These companies offer incentive fees in order to encourage wise (and profitable) investments. Incentive fees usually come out of the portfolios that do well, rather than out of the company's general funds. They are also called performance fees. See also: Bonus, Manager Universe (Benchmark.)
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

incentive fee

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
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The latest open-ended fund has a low minimum investment of E1,000 and no extra layer of management or performance fees beyond the underlying fund fees.
There are proposals to not charge investors performance fees. They would have to pay only an annual fee of two per cent of funds under management.
The reward scheme for asset managers often consists of both management fees and performance fees. The former are set as a percentage of the assets under management (AUM); the latter are a function of the realized return on the managed portfolio.
All six winners received an opportunity to perform throughout the United States, sharing three years of managed concert tours and more than 300 prearranged engagements valued at more than a million dollars in combined performance fees. The gold medalists have additional engagements in Europe and Asia, in conjunction with IMG Artists, Europe.
Performance fees accounted for EUR 3.2 million of the total income.
Man recorded pretax profits of pounds 1.05 billion, driven by a 161 per cent increase in income from performance fees, which are payable when investment returns exceed stated targets, to pounds 473 million.
Measures taken to trim the budget included Bujones's agreement to waive possible commissions for fund-raising appearances and performance fees projected at $36,000.
There are those who say that if managers are put on performance fees, they'll take more risks.
The ratings also reflect Man's small long-only franchise relative to its peer group of traditional asset managers and the larger proportion of more volatile performance fees in its revenue mix, which potentially increases cash flow leverage volatility.
Beginning with the quarter ended March 31, 2018, reported management fees and incentive income will reflect the portion of the net earnings from management fees and performance fees, respectively, attributable to Oaktree's 20% ownership interest in DoubleLine Capital LP and its affiliates.
The Central Bank of Ireland has said that it is to undertake a thematic review of UCITS performance fees.
Adjusted results in the prior year quarter included the benefit of USD34.2 million of performance fees earned by the investment management business and higher levels of earnings in the originations business.

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