Using new data on the hedge fund investments of institutional investors, this paper is the first to examine the determinants and consequences of intermediation in the hedge fund industry. Our empirical analysis reveals several findings consistent with predictions from the theoretical literature....

We examine the simultaneous management of hedge funds and funds of hedge funds. Hedge fund firms can choose to simultaneously offer a fund of hedge funds. Similarly, fund of hedge fund firms can simultaneously offer a hedge fund. We find that while superior past performance and larger size drive...

We examine the determinants and consequences of changes in hedge fund fee structures. We show that fee changes are asymmetric with much greater incidence of fee increases compared to fee decreases. We find that managers of younger and smaller funds are more likely to increase fees after good...