Capital, Fund Structures, and Fees¶
Under development
This lesson is part of the course scaffold and is being actively written. The learning objectives and outline below define its final scope.
Learning objectives¶
By the end of this lesson you will be able to:
- Compare trading your own capital, prop-firm arrangements, and outside-capital fund structures on economics, control, and legal obligations
- Model net-to-manager and net-to-investor outcomes under management/performance fee structures with high-water marks across simulated return paths
- Estimate the minimum viable capital for a given strategy type by working from expected returns, cost base, and capacity constraints to break-even AUM
- Select a structure — personal account, prop arrangement, or fund vehicle — for a stated situation and defend the choice
Outline¶
- Trading your own capital — account types, entity choice, realistic economics
- Prop structures — firm capital, profit splits, first-loss arrangements
- Fund structures — LP/GP, master-feeder, managed accounts
- Management and performance fees — mechanics and incentive effects
- High-water marks and hurdles — crystallization and path dependence
- Capital requirements by strategy type — capacity, cost base, break-even AUM
- Choosing a path — a decision framework for the first five years