Recently, a private equity client complained about the quantitative giant High-Flyer Quantitative, saying1 million yuan to buy private placement products, only 800,000 yuan was left when redeemed, but 30,000 yuan was accrued for performance remuneration, which has attracted attention in the industry. This makes us have to think: why does the performance provision of private equity ** cause controversy?Which performance accrual method is more reasonable?What does this case teach us?
In this case, the private placement products purchased by the investors are tracked:CSI 300 IndexHowever, in the past two years, the CSI 300 index has continued to adjust. Is it reasonable for managers to accrue performance compensation by outperforming the CSI 300 Index by outperforming the CSI 300 Index?
In private placements**, performance provision is an important agreement between the manager and the investor. Generally speaking, the manager will set the standard of performance accrual based on factors such as performance and investors' risk tolerance.
As we all know, the CSI 300 Index has continued to adjust in the past two years. As of December 1, the CSI 300 index rose by -30 during the same period80%, while this quantitative product has a return of -22 since its inception45%, so it outperformed the CSI 300,According to the contract, 25% of the excess return of outperforming the CSI 300 Index will be used to calculate the performance remuneration, about 3020,000 yuan.
If there is such an agreement in the contract, then there is no dispute about this matter, and it will be done according to the contract.
AbsolutelyThis method of accrual may also cause psychological distress to investors。If the private placement** does not make money or even loses money, the investor will also be withdrawn from the performance remuneration of the excess rate of return, which will make the investor feel unfair and disappointed. This can lead to a decrease in investor trust in the manager.
Against such a background,The association advocates that "the interests of investors should be given priority in the accrual of performance remuneration".Some private equity firms have responded to the initiative of industry associations. Recently, a private equity firm named "Xu Xing Private Equity" recently announced that it was changed to "20% of the excess return part of the CSI 300 Index", and clarified three prerequisites, which mentioned that the product must be a positive return in order to calculate performance remuneration.
So, we can see from this caseThe performance accrual method of private placement needs to be more transparent and standardized. At the same time,Regulatory AuthoritiesIt is also necessary to strengthen the standard of performance accrual for private placement** to protect the interests of investors. What's more,When choosing investment and financial management, we investors need to carefully review the content of the contract and understand the various possible performance accrual methods and their impacts, so as to avoid unnecessary troubles in the future.