WEST PALM BEACH, FL (HEDGECO.NET) – Christopher Hohn has created the first hedge fund devoting some portion of its fees for charitable organization. Hohn was a former fund manager at Perry Capital,where he spent about seven years; he is regarded as one of the best fund managers in Europe. While at Perry Capital, Mr. Hohn managed the Perry European Fund with the assistance of Richard Perry, thefund earned about US$1 billion for its investors before it was liquidated.

Mr. Hohn,s new fund; the Children�s Investment fund was one of the largest hedge fund launches in Europe recently and total assets managed by the fund quickly grew to about US$700 million. According to published reports, about two thirds of the total assets in the Children�s Investment fund is locked in for a period of five years, while the rest of the assets have been committed for three years.

The Children�s Investment Fund Foundation is managed by Mr. Hohn�s wife Jamie Cooper-Hohn, the board of the new foundation also includes officials of some United Nations international agencies such as UNICEF and UNAIDS. The foundation would receive fifty percent of the Children�s Investment fund annual management fee of 1%, which amounts to about US$3.5million yearly. Such amount would ultimately be used to fund different Children�s projects in Africa and India.

It is also understood that for every year during which the Children�s Investment fund returns above 11%, an additional fifty percent of 1% of assets would also be given to the foundation. That translates to roughly US$3.5 million.

The incentive fees for the Children�s Investment Fund for the 5year and 3year lock in periods are 13.5% and 16.5% respectively. The Children�s Investment Fund has established a precedent by building its charitable donations into the fund�s fees structure. However this is not to say that other hedge funds do not give money to charity. Undoubtedly there are many hedge funds which donate money to charity every year, but none as far as we know have incorporated such gift into the fund�s fees structure. The fee structure of most hedge funds falls between 1-2% for management fees and about 20% for performance fees.

Paul Oranika
Editor-in-Chief
Hedgeco.net