Quote:
Originally Posted by rsmurano
For example: say I gave them a $2M to invest, and they did well and made me $100,000, I would pay them 1% of that $100,000 gain, not the $10,000-$20,000 fee that they would charge me for the $2M I gave them. Also, if they lost me money, then they would make no money, or better yet, they would give me 1% of my losses.
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Turn this around and ask yourself- Would you have accepted this arrangement with an employer when you worked for a living? Would you forfeit your paycheck if the company wasn't profitable? For salary or wages, would you share 1% of the company profits with every employee? Most people wouldn't, but there may be an exception or two.