What does the writer mean "LPs" here?
As first reported by the FT (and since confirmed by Fortune), this particular special is worth 5% off future fees. Assuming a $100 million commitment and a 2% management fee, we're talking about $100,000 in savings during the first year (transaction fees already will accrue 100% to LPs).

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I am stuck in the sentence "transaction fees already will accrue 100% to LPs". Anyone familiar with economics? What does the word "LPs" mean here?

Question

What does the writer mean "LPs" here?
As first reported by the FT (and since confirmed by Fortune), this particular special is worth 5% off future fees. Assuming a $100 million commitment and a 2% management fee, we're talking about $100,000 in savings during the first year (transaction fees already will accrue 100% to LPs).


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I am stuck in the sentence "transaction fees already will accrue 100% to LPs". Anyone familiar with economics? What does the word "LPs"  mean here?

Answer

Guess "LPs" is for "liquidity premiums" here but don't know what is it exactly.
From Wikipedia: Liquidity premium is a term used to explain a difference between two types of financial securities, that have all the same qualities except liquidity.

Answers · 1

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