Return to search

Chart of the week: Which GPs have the most skin in the game?

GPs are required to invest their own money into the funds they manage to qualify for long-term capital gain tax treatment. Limited partners prefer GPs to have “skin in the game”, because it shows a mutual commitment to success. However, that amount invested varies from firm-to-firm and sector-to-sector. The most common allocation is 2 percent of overall capital committed to a fund. The accompanying table gives a breakdown of firm types and allocation amounts.

cotw-1