Is there any CTA who charges clients the management and incentive fees QUARTERLY?

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88888888

Is there any CTA who charges clients the management and incentive fees QUARTERLY?

If you change clients QUARTERLY, how do you calculate your composite report MONTHLY (per NFA/CFTC requirements)?
 
Quote from the1:

You list it as an accrued fee to the investor each month and reconcile it at quarter's end.
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So, basically, you still have to calculate at the END or EACH month and you wait for at the end of each quarter and give the finally quarter bill to client?

For example, if

At the end of January, you calculate the fee for January is $1000.
At the end of February you calculate the fee for February is $2000.
At the end of March, you calculate the fee for March is $3000.

Then, at the end of March (or early April), you will bill client for total of $1K + $2K + $3K = $6K for the first quarter.

Is above understanding correct?
 
Correct. It's just an accrual account for the entire quarter. If an investor does not withdraw any funds during the quarter then there isn't much difficulty assigning the accrual amount. If they do withdraw then it gets a bit messy. Lockup periods are typically to keep accounting easy. Generally, Hedge Funds have a 90-day lockup period for this very reason. Redemptions can wreak havoc on a Hedge Fund's books unless the accounts are closed and reconciled first.

If you are dealing with M2M instruments such as futures it gets easier but if you are dealing with stocks that you haven't sold then it's nightmarish.

Quote from 88888888:

So, basically, you still have to calculate at the END or EACH month and you wait for at the end of each quarter and give the finally quarter bill to client?

For example, if

At the end of January, you calculate the fee for January is $1000.
At the end of February you calculate the fee for February is $2000.
At the end of March, you calculate the fee for March is $3000.

Then, at the end of March (or early April), you will bill client for total of $1K + $2K + $3K = $6K for the first quarter.

Is above understanding correct?
More...
 
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