The problem of asymmetric risk sharing between investors and fund managers in the hedge fund industry can be:
A.Increased by the existence of a high water mark.
B.Increased by high incentive fees for fund managers.
C.Decreased by low fund closure costs.
D.Decreased by limiting the amount that a fund manager can invest in any fund that he manages.
How to reduce asymmetric risk
1.High water mark.
2.Lower incentive fees for fund managers.
3.High fund closure costs.
4.Force a fund manager to invest in any fund that he manages.