3.38.1.3 Forced Redemption

This topic provides information on forced redemption.

The forced redemption method is an arithmetic method applied to all subscriptions made at a price (GAVPS) regardless of whether it is above or below the current HWM plus hurdle rate.

The forced redemption method ensures that all investors are treated equitably with regard to the paying of performance fees for performance since investing in the fund. This process calculates the number of shares to be redeemed either at the point of an early redemption or at the end of the performance fee period based on the movement of the price since subscription time.