Foreign fund houses are gearing up to float India-dedicated hedge funds under the emerging markets group to woo foreign investors, especially to invest in derivatives, beginning April. The main attraction for fund houses is the fat fee which can be charged on hedge funds, sources said.
Hedge funds are attractive for fund managers because, unlike mutual fund managers who generally work for a fixed compensation tied to the size of the fund, hedge managers get paid on two lucrative tiers. They collect 1-2 per cent of their funds