Performance Fees Calculator

A Performance Fees Calculator helps you understand how profit-sharing fee structures work in wealth management. Unlike traditional percentage-based fees, performance fees are only charged when your portfolio generates profits above a certain threshold, aligned with the "high water mark" principle.

Why it matters: Performance-based fees align the interests of wealth managers with clients - advisors only earn more when you earn more. Understanding this model helps you appreciate transparent pricing and make informed decisions about wealth management services.

Our Performance Fees Calculator demonstrates how RuDo Elite's profit-sharing model works and protects your interests.

Key Benefits:

• Fee Transparency: See exactly when and how much you pay in fees
• High Water Mark: Understand how this protection prevents paying twice on same gains
• Scenario Analysis: Model different market conditions and see fee impact
• Comparison Tool: Compare performance fees vs traditional percentage fees
• Year-by-Year Breakdown: View detailed annual calculations
• Total Cost Visibility: See cumulative fees over your investment horizon

The calculator demonstrates the High Water Mark (HWM) principle:

Key Concepts:

1. High Water Mark (HWM)

The highest portfolio value ever achieved. This becomes your new baseline.

2. Performance Fee

Charged only on NEW profits above the HWM.

3. Fee Calculation

Fee = (Current Value - HWM) × Fee Percentage

Example:

Initial Investment: AED 1,000,000

Year 1: +20% → Value: AED 1,200,000 (New HWM)

Fee: (1,200,000 - 1,000,000) × 10% = AED 20,000

Year 2: -10% → Value: AED 1,080,000 (Below HWM)

Fee: AED 0 (No fee on losses or recovery)

Year 3: +25% → Value: AED 1,350,000 (Above HWM)

Fee: (1,350,000 - 1,200,000) × 10% = AED 15,000

Using our Performance Fees Calculator:

Step 1: Enter Initial Portfolio Value

Input your starting investment amount.

Step 2: Set Performance Fee Percentage

Enter the profit-sharing percentage (RuDo Elite charges ≤10%).

Step 3: Add Annual Returns

Input expected or historical annual returns for each year.

Step 4: View Year-by-Year Analysis

See how HWM changes and when fees are charged.

Step 5: Analyze Protection

Notice how you pay nothing during down years or recovery periods.

Step 6: Compare Total Costs

Compare with traditional fixed-fee models.

1. Aligned Interests

Wealth manager only profits when you profit - true partnership.

2. Protection in Downturns

No fees during market crashes or recovery periods.

3. High Water Mark Safety

Never pay twice on the same gains.

4. Cost Efficiency

In flat or down markets, you pay significantly less than fixed fees.

5. Motivation for Performance

Manager is incentivized to maximize your returns.

6. Transparent Pricing

Clear, understandable fee structure with no hidden charges.

7. Fair Value

You pay for actual results, not just assets under management.

8. RuDo Elite Advantage

Our ≤10% profit-sharing is among the most competitive in the industry.