What is a highwater mark and how do you apply it to Arbidyne Managed Account Service?
A high-water mark is the highest peak in value that your Managed Account has reached. With a high-water mark in place, you pay a fee that only covers the amount the fund earned between the point of entry and its highest level.
Please refer to the following table for a highwater mark calculation:
Item | Month 1 | Month 2 | Month 3 | Month 4 |
Return | $15,000 | $10,000 | -$30,000 | $15,000 |
Cumulative Return | $15,000 | $25,000 | -$5,000 | $10,000 |
High Water Mark | $0 | $15,000 | $25,000 | $25,000 |
Performance fee payable? | Yes | Yes | No | No |
Performance fee amount (33% for Australian clients inclusive of GST) | $4,950 | $3,300 | NA | NA |
Performance fee amount (30% for international clients) | $4,500 | $3,000 | NA | NA |