Some Chinese fund managers forced to halt fees

08/5/2008 | AsianInvestor.net

A legacy clause in Chinese fund contracts requires managers to stop collecting fees once a fund's performance falls below a preset level. As China's A-share market continues to decline, as many as a dozen fund managers have likely triggered the fee suspension. Michael McCormack of Z-Ben Advisors, a research house in Shanghai, said the clause goes back to before 2002-2003, when numerous safeguards were necessary to obtain a license for a fund.

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