Help CenterThe High-Water Mark (HWM) Model serves as the mechanism for determining the performance fees a strategy earns from its followers.
The HWM represents the peak value achieved by the following account when performance fees are applied.This approach guarantees that the strategy provider is not compensated redundantly for identical performance.
Performance fees are only awarded to the strategy provider when there is a generation of new profits for the follower's account.
The high-water mark ensures that the manager is not compensated with significant amounts for poor performance.
Performance fee calculation :
Performance fee : Investor profit x performance fee %
For example : $100 x 30% : $30
Performance fee : $30
The Performance Fee is determined by the net profit generated by the copier, employing a High-Water Mark model for calculation.