Carried Interest

Carried interest (short form: Carry) is a form of profit sharing of the fund company and their employees at the expense of investors in a private equity fund.

Usually, the manager (often up to 20%) receive a share of the profits from capital investment (English: Capital Gain ). Often, the carried interest is due only after a pre-agreed minimum return (English: hurdle rate) reached the appointed by the investors capital. This minimum return varies in practice between 6 % and 8 % per year.

• Private Equity